Back to top

Image: Bigstock

Itron (ITRI) Q2 Earnings Miss Estimates, Revenues Drop Y/Y

Read MoreHide Full Article

Itron Inc (ITRI - Free Report) reported non-GAAP earnings of 7 cents per share in second-quarter 2022, surpassing the Zacks Consensus Estimate by 66.7%. The bottom line decreased 75% year over year.

Revenues were $431.9 million, which lagged the Zacks Consensus Estimate by 12.3%. Further, the top line declined 12%(down 8% on a constant-currency basis) year over year.

The decline in the top line was attributed to supply challenges and component constraints, which offset robust customer demand. Sluggishness in the company’s Device Solutions and Outcomes segment was a major concern.

Product revenues were $359.9 million (83.3% of total revenues), down 12.6% year over year. Service revenues totaled $71.9 million (16.7%), down 7.3% from the year-ago quarter’s levels.

The company’s bookings were $612 million and the backlog totaled $4.1 billion at the end of the reported quarter.

Itron, Inc. Price, Consensus and EPS Surprise

 

Itron, Inc. Price, Consensus and EPS Surprise

Itron, Inc. price-consensus-eps-surprise-chart | Itron, Inc. Quote

 

Segments in Detail

Device Solutions: The company generated revenues of $105 million (24.3% of the total revenues) from the segment, down 36% from the year-ago quarter.

Networked Solutions: Revenues from the segment were $269 million (62.4% of the total revenues), up 2% year over year.

Outcomes: The segment generated revenues of $58 million (13.3% of the total revenues), down 6% on a year-over-year basis, driven by decreased product and software license sales.

Operating Details

Itron’s gross margin in the second quarter was 29.2%, which contracted 140 basis points (bps) on a year-over-year basis. The downside was caused by increasing component costs and manufacturing inefficiencies.

Non-GAAP operating expenses were $117.1 million, down 4.8% year over year due to lower product development expenses.

Non-GAAP operating income was $9 million, down 66% year over year. Non-GAAP operating margin in the second quarter was 2.1%, which contracted 340 bps year over year.

Balance Sheet & Cash Flows

As of Jun 30, 2022, cash and cash equivalents totaled $208.5 million, up from $203.9 million as of Mar 31, 2022. Accounts receivables were $259.7 million, up from $303.2 million in the prior quarter.

Long-term debt at the end of the second quarter stood at $451.4 million compared with $450.8 million at the end of the quarter ended Mar 31, 2022.

Itron generated $15 million of cash from operations in the reported quarter compared with $73 million in the comparable period in the prior quarter.

It generated a free cash flow of $10 million in the reported quarter compared with $64 million in the prior quarter.

Guidance

For the full year, the company expects revenues between $1.85 to $1.9 billion as against the earlier guided range of $2-$2.1 billion.

Non-GAAP diluted earnings per share are expected to be in the range of 70-90 cents against earlier guided range of earnings between $1.25 and $1.75 per share.

Zacks Rank & Stocks to Consider

Currently, Itron has a Zacks Rank #3 (Hold).

Some other top-ranked stocks from the broader technology sector worth consideration are Cadence Design Systems (CDNS - Free Report) , Intuit (INTU - Free Report) and Badger Meter (BMI - Free Report) . Cadence and Badger Meter sports a Zacks Rank #1 (Strong Buy), while Intuit carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 7% in the past 60 days. Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, with the average being 12.6%. Shares of BMI have lost 5.7% of their value in the past year.

The Zacks Consensus Estimate for Cadence’s 2022 earnings is pegged at $4.11 per share, up 5.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.7%.

CDNS earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 9.8%. Shares of CDNS have increased 22.9% in the past year.

The Zacks Consensus Estimate for Intuit’s fiscal 2022 earnings is pegged at $11.72 per share, rising 0.2% in the past 60 days. The long-term earnings growth rate is anticipated to be 15.6%.

Intuit’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average being 16.8%. Shares of INTU have lost 12.7% in the past year.