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Cambium (CMBM) Beats Q3 Earnings Estimates on Top-Line Growth
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Cambium Networks Corporation (CMBM - Free Report) reported relatively healthy third-quarter 2022 results, with the bottom line and the top line beating the respective Zacks Consensus Estimate. The company expects to strengthen its technology roadmap and strategy as supply chain adversities continue to ease.
Net Income
On a GAAP basis, net income in the September quarter was $9.4 million or 34 cents per share compared with $4.6 million or 16 cents per share in the prior-year quarter. The year-over-year improvement was primarily attributable to top-line growth owing to record demand for Enterprise products.
Non-GAAP net income came in at $11.3 million or 40 cents per share compared with $6.7 million or 23 cents per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 21 cents.
Cambium Networks Corporation Price, Consensus and EPS Surprise
Quarterly revenues improved to $81.2 million from $75.9 million in the year-ago quarter, driven by record demand for Enterprise products and higher Point-to-Point revenues, partially offset by lower Point-to-Multi-Point revenues. The top line beat the consensus estimate of $74 million.
By product category, quarterly revenues at Point-to-Multi-Point came in at $26.1 million compared with $50.1 million a year ago. This was due to continued sluggishness for legacy PMP 450 products from service providers ahead of product transitions to new technologies. Point-to-Point revenues increased to $15.4 million from $13.9 million due to higher shipments for PTP products using unlicensed frequencies. Revenues at Enterprises surged to $38.3 million from $10.7 million. The record-high Enterprises revenues were driven by solid demand for Wi-Fi 6 and 6E solutions, record switching revenues and healthy growth in SaaS solutions.
Other Details
Non-GAAP gross profit increased to $41.6 million from $36.3 million for respective margins of 51.3% and 47.8%, owing to higher revenues. Total operating expenses were $31.2 million compared with $30.2 million in the prior-year quarter. Non-GAAP operating income rose to $13.8 million from $8.7 million. Adjusted EBITDA totaled $14.7 million compared with $9.6 million a year ago, for respective margins of 18.2% and 12.6%.
Cash Flow & Liquidity
During the quarter, Cambium generated $2.2 million from operating activities compared with $11.8 million in the prior-year period. As of Sep 30, 2022, the company had a $44.9 million cash balance with $25.1 million of long-term debt.
Guidance
With healthy quarterly results, Cambium has provided a bullish outlook for the fourth quarter. For the ongoing quarter, revenues are expected to be in the range of $80-$84 million. Non-GAAP earnings are anticipated to be in the band of $6.6-$7.8 million or 23-27 cents per share. Non-GAAP operating income is projected between $8.4 million and $10.2 million, while adjusted EBITDA is likely to be in the range of $9.5-$11.3 million, with a corresponding margin between 11.9% and 13.4%.
Sierra Wireless has a long-term earnings growth expectation of 15% and delivered an earnings surprise of 229.9%, on average, in the trailing four quarters. Over the past year, the stock has gained 80.3%. Earnings estimates for the current year have moved up 4400% since October 2021. Sierra Wireless continues to launch innovative products for business-critical operations that require high security and optimum 5G performance.
InterDigital, Inc. (IDCC - Free Report) , sporting a Zacks Rank #1, is another key pick for investors. It has a long-term earnings growth expectation of 25% and delivered a stellar earnings surprise of 81.9%, on average, in the trailing four quarters.
InterDigital is focused on pursuing agreements with unlicensed customers in the handset and consumer electronics markets. The company aims to become a leading designer and developer of technology solutions and innovation for the mobile industry, IoT and allied technology areas. InterDigital’s global footprint, diversified product portfolio and ability to penetrate different markets are impressive.
Comtech Telecommunications Corp. (CMTL - Free Report) , sporting a Zacks Rank #1, is another key pick. Headquartered in Melville, NY, the company is a leading global provider of next-generation 911 emergency systems and secure wireless communications technologies to commercial and government customers.
Comtech’s key satellite earth station modems incorporate forward error correction and bandwidth compression technologies, which enable its customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data throughput. It holds leadership positions in the market for high-throughput modems used in cellular backhaul.
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Cambium (CMBM) Beats Q3 Earnings Estimates on Top-Line Growth
Cambium Networks Corporation (CMBM - Free Report) reported relatively healthy third-quarter 2022 results, with the bottom line and the top line beating the respective Zacks Consensus Estimate. The company expects to strengthen its technology roadmap and strategy as supply chain adversities continue to ease.
Net Income
On a GAAP basis, net income in the September quarter was $9.4 million or 34 cents per share compared with $4.6 million or 16 cents per share in the prior-year quarter. The year-over-year improvement was primarily attributable to top-line growth owing to record demand for Enterprise products.
Non-GAAP net income came in at $11.3 million or 40 cents per share compared with $6.7 million or 23 cents per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 21 cents.
Cambium Networks Corporation Price, Consensus and EPS Surprise
Cambium Networks Corporation price-consensus-eps-surprise-chart | Cambium Networks Corporation Quote
Revenues
Quarterly revenues improved to $81.2 million from $75.9 million in the year-ago quarter, driven by record demand for Enterprise products and higher Point-to-Point revenues, partially offset by lower Point-to-Multi-Point revenues. The top line beat the consensus estimate of $74 million.
By product category, quarterly revenues at Point-to-Multi-Point came in at $26.1 million compared with $50.1 million a year ago. This was due to continued sluggishness for legacy PMP 450 products from service providers ahead of product transitions to new technologies. Point-to-Point revenues increased to $15.4 million from $13.9 million due to higher shipments for PTP products using unlicensed frequencies. Revenues at Enterprises surged to $38.3 million from $10.7 million. The record-high Enterprises revenues were driven by solid demand for Wi-Fi 6 and 6E solutions, record switching revenues and healthy growth in SaaS solutions.
Other Details
Non-GAAP gross profit increased to $41.6 million from $36.3 million for respective margins of 51.3% and 47.8%, owing to higher revenues. Total operating expenses were $31.2 million compared with $30.2 million in the prior-year quarter. Non-GAAP operating income rose to $13.8 million from $8.7 million. Adjusted EBITDA totaled $14.7 million compared with $9.6 million a year ago, for respective margins of 18.2% and 12.6%.
Cash Flow & Liquidity
During the quarter, Cambium generated $2.2 million from operating activities compared with $11.8 million in the prior-year period. As of Sep 30, 2022, the company had a $44.9 million cash balance with $25.1 million of long-term debt.
Guidance
With healthy quarterly results, Cambium has provided a bullish outlook for the fourth quarter. For the ongoing quarter, revenues are expected to be in the range of $80-$84 million. Non-GAAP earnings are anticipated to be in the band of $6.6-$7.8 million or 23-27 cents per share. Non-GAAP operating income is projected between $8.4 million and $10.2 million, while adjusted EBITDA is likely to be in the range of $9.5-$11.3 million, with a corresponding margin between 11.9% and 13.4%.
Zacks Rank & Stocks to Consider
Cambium currently has a Zacks Rank #3 (Hold).
A better-ranked stock in the broader industry is Sierra Wireless, Inc. , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Sierra Wireless has a long-term earnings growth expectation of 15% and delivered an earnings surprise of 229.9%, on average, in the trailing four quarters. Over the past year, the stock has gained 80.3%. Earnings estimates for the current year have moved up 4400% since October 2021. Sierra Wireless continues to launch innovative products for business-critical operations that require high security and optimum 5G performance.
InterDigital, Inc. (IDCC - Free Report) , sporting a Zacks Rank #1, is another key pick for investors. It has a long-term earnings growth expectation of 25% and delivered a stellar earnings surprise of 81.9%, on average, in the trailing four quarters.
InterDigital is focused on pursuing agreements with unlicensed customers in the handset and consumer electronics markets. The company aims to become a leading designer and developer of technology solutions and innovation for the mobile industry, IoT and allied technology areas. InterDigital’s global footprint, diversified product portfolio and ability to penetrate different markets are impressive.
Comtech Telecommunications Corp. (CMTL - Free Report) , sporting a Zacks Rank #1, is another key pick. Headquartered in Melville, NY, the company is a leading global provider of next-generation 911 emergency systems and secure wireless communications technologies to commercial and government customers.
Comtech’s key satellite earth station modems incorporate forward error correction and bandwidth compression technologies, which enable its customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data throughput. It holds leadership positions in the market for high-throughput modems used in cellular backhaul.