Back to top

Image: Bigstock

Universal Display (OLED) Misses on Q2 Earnings and Revenues

Read MoreHide Full Article

Universal Display Corporation (OLED - Free Report) reported weak second-quarter 2022 results wherein both the bottom line and the top line missed the Zacks Consensus Estimate. This was due to factors like macroeconomic uncertainty affecting consumer product demand cycles, capacity ramp schedules and production loading rates.

Quarter Details

Net income during the reported quarter was $41.5 million or 87 cents per share compared with $40.5 million or 85 cents per share in the year-ago quarter, missing the Zacks Consensus Estimate by 10 cents. Despite higher operating expenses, net income grew 2.4% from the prior-year quarter on top-line growth.

Revenues reported during the quarter were $136.6 million, missing the Zacks Consensus Estimate of $150 million and growing 5.3 % from the prior-year quarter. The material sales segment reported revenues of $71.9 million compared with $77.4 million in the prior-year quarter, reflecting a decline of 7.2%. For the year, due to inflationary pressure, the company estimates material gross margins will be toward the lower end of the guidance range of 65% to 70%. The royalty and license fees generated revenues of $60.3 million compared with $48.2 million in the prior-year quarter, reflecting growth of 25%. The contract research services generated revenues of $4.4 million, up 10.1% from $4 million in the prior-year quarter.

 

Operating Details

Gross profit in the second quarter was $109.3 million compared with $101.7 million, implying growth of 7.5%. Operating income during the quarter was $53.3 million compared with $49.9 million in the prior-year quarter, implying a rise of 6.9%. Total operating expenses during the quarter were $56 million, up from $51.8 million.

Cash Flow & Liquidity

During the first six months of 2022, Universal Display generated $86.1 million from operating activities compared with $59.1 million in the prior-year period. As of Jun 30, 2022, the company had $213.9 million in cash and cash equivalents and $80.7 in other liabilities.

Guidance

For 2022, Universal Display currently expects revenues to be approximately $600 million, plus or minus $10 million, down from earlier expectations of $625 million and $650 owing to lower demand trends driven by inflationary pressures and a challenging macroeconomic environment.

Zacks Rank & Stocks to Consider

Universal Display currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Lemonade, Inc. (LMND - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 4.6%, on average, in the trailing four quarters. Over the past year, the stock has fallen 71.1%.

Earnings estimates for the current year have moved down 41.7% since August 2021. Lemonade’s primary strategy is to provide insurance products in the United States and Europe.

Celsius Holdings, Inc. (CELH - Free Report) , sporting a Zacks Rank #1, is another key pick for investors. It delivered an earnings surprise of 200% in the previous quarter and a stellar earnings surprise of 206.25%, on average, in the trailing four quarters. Celsius develops, markets, distributes and sells functional drinks and liquid supplements in North America, Europe, Asia and internationally.

Earnings estimates for the current year have moved up 23.7% since August 2021.

Delek US Holdings, Inc. (DK - Free Report) sports a Zacks Rank #1. The Zacks Consensus Estimate for Delek’s current-year earnings has been revised 3239.1% upward since August 2021.

Published in