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Advanced Energy (AEIS) Q4 Earnings Beat, Revenues Rise Y/Y
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Advanced Energy Industries, Inc. (AEIS - Free Report) reported fourth-quarter 2022 non-GAAP earnings of $1.70 per share, beating the Zacks Consensus Estimate by 7.6%. Further, the bottom line increased by 25% from the year-ago quarter.
Revenues of $490.74 million surpassed the Zacks Consensus Estimate of $471.5 million. The top line improved 24% year over year.
Strong momentum across the end markets drove top-line growth in the reported quarter.
Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise
Semiconductor Equipment: Revenues generated from the market grew 30% year over year to $232.46 million (47.4% of the total revenues). Strong wins in inspection and remote plasma sources and the introduction of new technology platforms were positives.
Industrial & Medical: Revenues from the market grew 21% year over year to $119.33 million (24.3% of the total revenues) in the reported quarter. Top line growth in the market was driven by growing design wins in surgical, medical, laser, diagnostic and life science equipment. Also, industrial wins in 3D printing, test and measurement and industrial laser contributed well.
Data Center Computing: Revenues from the market were $94.52 million (19.3% of the total revenues), up 18% from the year-ago quarter’s level.
Telecom & Networking: Revenues generated from the market were $44.43 million (9% of the total revenues), up 15% from the prior-year quarter’s level.
Operating Results
In the fourth quarter, GAAP gross margin was 36.2%, which expanded 100 basis points (bps) year over year. The non-GAAP gross profit margin was 36.6%, which expanded by 110 bps from the year-ago quarter’s level.
Non-GAAP operating expenses were $100.9 million, up 17.2% year over year. As a percentage of revenues, the figure contracted 110 bps year over year to 20.6% in the reported quarter.
The non-GAAP operating margin was 16%, expanding 220 bps from the prior-year quarter’s level.
Balance Sheet & Cash Flow
As of Dec 31, 2022, cash and cash equivalents were $458.82 million compared with $409.05 million as of Sep 30, 2022.
Total debt was $373.3 million at the fourth-quarter end, down from $378.1 million at the third-quarter end.
For the fourth quarter, cash flow from operations was $70.7 million, which jumped from $65.4 million in the second quarter.
Advanced Energy made dividend payments of $3.8 million and repurchased shares worth $0.7 million in the quarter.
Guidance
For first-quarter 2022, Advanced Energy expects non-GAAP earnings of $1.10 per share (+/- 25 cents). The Zacks Consensus Estimate is pegged at $1.24 per share.
Advanced Energy anticipates revenues of $415 million (+/- $20 million). The Zacks Consensus Estimate for the same is pegged at $433.01 million.
Zacks Rank & Stocks to Consider
Currently, Advanced Energy has a Zacks Rank #3 (Hold).
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Advanced Energy (AEIS) Q4 Earnings Beat, Revenues Rise Y/Y
Advanced Energy Industries, Inc. (AEIS - Free Report) reported fourth-quarter 2022 non-GAAP earnings of $1.70 per share, beating the Zacks Consensus Estimate by 7.6%. Further, the bottom line increased by 25% from the year-ago quarter.
Revenues of $490.74 million surpassed the Zacks Consensus Estimate of $471.5 million. The top line improved 24% year over year.
Strong momentum across the end markets drove top-line growth in the reported quarter.
Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise
Advanced Energy Industries, Inc. price-consensus-eps-surprise-chart | Advanced Energy Industries, Inc. Quote
End Market in Detail
Semiconductor Equipment: Revenues generated from the market grew 30% year over year to $232.46 million (47.4% of the total revenues). Strong wins in inspection and remote plasma sources and the introduction of new technology platforms were positives.
Industrial & Medical: Revenues from the market grew 21% year over year to $119.33 million (24.3% of the total revenues) in the reported quarter. Top line growth in the market was driven by growing design wins in surgical, medical, laser, diagnostic and life science equipment. Also, industrial wins in 3D printing, test and measurement and industrial laser contributed well.
Data Center Computing: Revenues from the market were $94.52 million (19.3% of the total revenues), up 18% from the year-ago quarter’s level.
Telecom & Networking: Revenues generated from the market were $44.43 million (9% of the total revenues), up 15% from the prior-year quarter’s level.
Operating Results
In the fourth quarter, GAAP gross margin was 36.2%, which expanded 100 basis points (bps) year over year. The non-GAAP gross profit margin was 36.6%, which expanded by 110 bps from the year-ago quarter’s level.
Non-GAAP operating expenses were $100.9 million, up 17.2% year over year. As a percentage of revenues, the figure contracted 110 bps year over year to 20.6% in the reported quarter.
The non-GAAP operating margin was 16%, expanding 220 bps from the prior-year quarter’s level.
Balance Sheet & Cash Flow
As of Dec 31, 2022, cash and cash equivalents were $458.82 million compared with $409.05 million as of Sep 30, 2022.
Total debt was $373.3 million at the fourth-quarter end, down from $378.1 million at the third-quarter end.
For the fourth quarter, cash flow from operations was $70.7 million, which jumped from $65.4 million in the second quarter.
Advanced Energy made dividend payments of $3.8 million and repurchased shares worth $0.7 million in the quarter.
Guidance
For first-quarter 2022, Advanced Energy expects non-GAAP earnings of $1.10 per share (+/- 25 cents). The Zacks Consensus Estimate is pegged at $1.24 per share.
Advanced Energy anticipates revenues of $415 million (+/- $20 million). The Zacks Consensus Estimate for the same is pegged at $433.01 million.
Zacks Rank & Stocks to Consider
Currently, Advanced Energy has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer & Technology sector are Agilent Technologies (A - Free Report) , Arista Networks (ANET - Free Report) and Garmin (GRMN - Free Report) , all three carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Agilent has gained 8.4% in the past year. A’s long-term earnings growth rate is currently projected at 10%.
Arista Networks has gained 6.1% in the past year. The long-term earnings growth rate for ANET is currently projected at 17.5%.
Garmin has lost 24.6% in the past year. The long-term earnings growth rate for GRMN is currently projected at 5.6%.