MACOM Technology Solutions Holdings, Inc. ( MTSI Quick Quote MTSI - Free Report) reported second-quarter fiscal 2023 non-GAAP earnings of 79 cents per share, beating the Zacks Consensus Estimate by 2.6%. Further, the bottom line improved by 16.2% from the year-ago quarter’s reported figure. Revenues of $169.41 million surpassed the Zacks Consensus Estimate by 0.9%. Moreover, the top line rose 2.6% from the year-ago quarter’s figure. Top-line growth was driven by the company’s strong performance across Data Center and Industrial and Defense markets. Top Line in Detail Telecom Market: MTSI generated revenues of $53.9 million (31.8% of the total revenues) from the market, down 14.4% year over year. Data Center Market: The market generated revenues of $38.3 million (22.6% of the total revenues), up 9.2% from the year-ago quarter. Industrial & Defense Market: MACOM generated revenues of $77.2 million (45.6% of the total revenues) from the market, up 15% year over year. Operating Details
In second-quarter fiscal 2023, the non-GAAP gross margin was 62.1%, which expanded 40 basis points (bps) from the year-ago fiscal quarter’s reported figure.
In the reported quarter, non-GAAP operating expenses were $48.6 million, which decreased 4.7% from the year-ago fiscal quarter’s reported figure. As a percentage of revenues, the figure contracted 220 bps to 28.7%. Consequently, MTSI’s non-GAAP operating margin was 33.4%, which increased 260 bps from the prior-year quarter’s figure. Balance Sheet
As of Mar 31, 2023, cash equivalents and short-term investments were $577.3 million, down from $594.7 million as of Dec 30, 2022.
Inventories were $131.9 million, up from $121.3 million in the previously reported quarter. Long-term debt obligations, excluding the current portion, were $566.7 million in the reported quarter compared with $566.3 million in the previous quarter. Guidance
For third-quarter fiscal 2023, MACOM expects revenues between $145 million and $150 million.
MTSI’s adjusted earnings per share are anticipated to be within 52-56 cents. The Zacks Consensus Estimate for the same is pegged at 73 cents. The non-GAAP gross margin is anticipated to be 59-61%. Zacks Rank & Stocks to Consider
Currently, MACOM has a Zacks Rank #2 (Buy).
Investors interested in the broader technology sector can consider some other top-ranked stocks like Agilent Technologies ( A Quick Quote A - Free Report) , DigitalOcean ( DOCN Quick Quote DOCN - Free Report) and Paycor HCM ( PYCR Quick Quote PYCR - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Agilent Technologies is set to report second-quarter fiscal 2023 results on May 23. The Zacks Consensus Estimate for A’s earnings is pegged at $1.27 per share, implying growth of 12.4% from the year-ago quarter’s reported figure. A has lost 11.6% in the year-to-date period. DigitalOcean is scheduled to release first-quarter 2023 results on May 9. The Zacks Consensus Estimate for DOCN’s earnings is pegged at 29 cents per share, suggesting a jump from 7 cents per share reported in the prior-year quarter. DOCN has gained 25.5% in the year-to-date period. Paycor HCM is scheduled to report third-quarter fiscal 2023 results on May 10. The Zacks Consensus Estimate for PYCR’s earnings is pegged at 15 cents per share, suggesting an increase of 36.4% from the prior-year quarter’s reported figure. PYCR has gained 26% in the year-to-date period.