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Ubiquiti's (UI) Q4 Earnings Miss Despite Higher Revenues
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Ubiquiti Inc. (UI - Free Report) reported mixed fourth-quarter fiscal 2023 results, with the bottom line missing the Zacks Consensus Estimate but the top line matching the same. The New York-based networking products and solutions providers reported top-line expansion year over year, backed by solid demand trends in the Enterprise Technology vertical.
Net Income
GAAP net income in the quarter was $103.7 million or $1.72 per share compared with $92.5 million or $1.53 per share in the year-ago quarter. The improvement was primarily attributable to top-line growth.
Non-GAAP net income in the fourth quarter of fiscal 2023 was $104.7 million or $1.73 per share, up from $93.3 million or $1.54 per share in the year-earlier quarter. The bottom line missed the Zacks Consensus Estimate by 34 cents.
For fiscal 2023, GAAP net income was $407.6 million or $6.74 per share compared with $378.7 million or $6.13 per share in fiscal 2022. Net income on a non-GAAP basis for fiscal 2023 was $411.2 million or $6.80 per share compared with $380.4 million or $6.16 per share in fiscal 2022.
Quarterly net sales rose to $491.1 million, up 10.8% from $443.1 million in the year-ago quarter. Healthy demand trends in the Enterprise Technology vertical supported the top-line growth during the quarter. However, declining trends in the Service Provider Technology segment partially reversed this trend. The top line matched the consensus estimate of $491 million.
In fiscal 2023, the company reported net sales of $1,940.5 million compared with $1,691.7 million in fiscal 2022.
In the fiscal fourth quarter, revenues from Enterprise Technology totaled $404.1 million, up from $344.5 million in the year-ago quarter. The top line fell short of our estimate of $407.4 million. Enterprise Technology accounted for 82.3% of the company’s revenues in the fiscal fourth quarter.
Service Provider Technology contributed $87 million in revenues, down from $98.6 million in the year-ago quarter. Net sales surpassed our revenue estimate of $86.1 million.
Region-wise, revenues from North America stood at $238.3 million, up from $211.1 million a year ago, and contributed to 48.5% in total revenues. Net sales from Europe, the Middle East, and Africa aggregated $190.9 million, up from $176.5 million. Asia Pacific revenues decreased marginally to $32.3 million from $32.8 million in the year-earlier quarter. Revenues from South America increased to $29.5 million from $22.8 million in the year-ago quarter.
Other Details
During the fiscal fourth quarter, gross profit rose to $203.3 million from $169.6 million in the year-ago quarter, with respective margins of 41.4% and 38.3%. The improvement was primarily driven by lower component and shipping expenses. However, changes in product mix partially reversed this positive trend. Operating income was $143.9 million, up from $112.6 million in the prior year.
Cash Flow & Liquidity
In fiscal 2023, Ubiquiti utilized $145.4 million of cash in operating activities against a cash flow of $370.3 million in fiscal 2022. The sharp decline was primarily due to an increase in inventory, higher vendor deposits and accounts receivable.
As of Jun 30, 2023, the company had $114.8 million in cash and cash equivalents with $1.04 billion of long-term debt compared with the respective figures of $136.2 million and $762.6 million a year ago.
Zacks Rank & Stocks to Consider
Ubiquiti currently carries a Zacks Rank #3 (Hold).
Motorola Solutions, Inc (MSI - Free Report) , carrying a Zacks Rank #2 (Buy) at present, delivered an earnings surprise of 5.62%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 5.58%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure service providers. It develops and services, both analog and digital two-way radio, voice and data communications products and systems for private networks, wireless broadband systems and end-to-end enterprise mobility solutions to a wide range of enterprise markets.
Workday Inc. (WDAY - Free Report) , currently sporting a Zacks Rank #1, delivered an earnings surprise of 15.38%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 14.40%.
Workday is a provider of enterprise-level software solutions for financial management and human resource domains. The company’s cloud-based platform combines finance and HR in a single system, which makes it easier for organizations to provide analytical insights and decision support.
NVIDIA Corporation (NVDA - Free Report) , currently sporting a Zacks Rank #1, delivered an earnings surprise of 9.79%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 29.19%.
NVIDIA is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence-based solutions that now support high-performance computing, gaming and virtual reality platforms.
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Ubiquiti's (UI) Q4 Earnings Miss Despite Higher Revenues
Ubiquiti Inc. (UI - Free Report) reported mixed fourth-quarter fiscal 2023 results, with the bottom line missing the Zacks Consensus Estimate but the top line matching the same. The New York-based networking products and solutions providers reported top-line expansion year over year, backed by solid demand trends in the Enterprise Technology vertical.
Net Income
GAAP net income in the quarter was $103.7 million or $1.72 per share compared with $92.5 million or $1.53 per share in the year-ago quarter. The improvement was primarily attributable to top-line growth.
Non-GAAP net income in the fourth quarter of fiscal 2023 was $104.7 million or $1.73 per share, up from $93.3 million or $1.54 per share in the year-earlier quarter. The bottom line missed the Zacks Consensus Estimate by 34 cents.
For fiscal 2023, GAAP net income was $407.6 million or $6.74 per share compared with $378.7 million or $6.13 per share in fiscal 2022. Net income on a non-GAAP basis for fiscal 2023 was $411.2 million or $6.80 per share compared with $380.4 million or $6.16 per share in fiscal 2022.
Ubiquiti Inc. Price, Consensus and EPS Surprise
Ubiquiti Inc. price-consensus-eps-surprise-chart | Ubiquiti Inc. Quote
Revenues
Quarterly net sales rose to $491.1 million, up 10.8% from $443.1 million in the year-ago quarter. Healthy demand trends in the Enterprise Technology vertical supported the top-line growth during the quarter. However, declining trends in the Service Provider Technology segment partially reversed this trend. The top line matched the consensus estimate of $491 million.
In fiscal 2023, the company reported net sales of $1,940.5 million compared with $1,691.7 million in fiscal 2022.
In the fiscal fourth quarter, revenues from Enterprise Technology totaled $404.1 million, up from $344.5 million in the year-ago quarter. The top line fell short of our estimate of $407.4 million. Enterprise Technology accounted for 82.3% of the company’s revenues in the fiscal fourth quarter.
Service Provider Technology contributed $87 million in revenues, down from $98.6 million in the year-ago quarter. Net sales surpassed our revenue estimate of $86.1 million.
Region-wise, revenues from North America stood at $238.3 million, up from $211.1 million a year ago, and contributed to 48.5% in total revenues. Net sales from Europe, the Middle East, and Africa aggregated $190.9 million, up from $176.5 million. Asia Pacific revenues decreased marginally to $32.3 million from $32.8 million in the year-earlier quarter. Revenues from South America increased to $29.5 million from $22.8 million in the year-ago quarter.
Other Details
During the fiscal fourth quarter, gross profit rose to $203.3 million from $169.6 million in the year-ago quarter, with respective margins of 41.4% and 38.3%. The improvement was primarily driven by lower component and shipping expenses. However, changes in product mix partially reversed this positive trend. Operating income was $143.9 million, up from $112.6 million in the prior year.
Cash Flow & Liquidity
In fiscal 2023, Ubiquiti utilized $145.4 million of cash in operating activities against a cash flow of $370.3 million in fiscal 2022. The sharp decline was primarily due to an increase in inventory, higher vendor deposits and accounts receivable.
As of Jun 30, 2023, the company had $114.8 million in cash and cash equivalents with $1.04 billion of long-term debt compared with the respective figures of $136.2 million and $762.6 million a year ago.
Zacks Rank & Stocks to Consider
Ubiquiti currently carries a Zacks Rank #3 (Hold).
Motorola Solutions, Inc (MSI - Free Report) , carrying a Zacks Rank #2 (Buy) at present, delivered an earnings surprise of 5.62%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 5.58%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure service providers. It develops and services, both analog and digital two-way radio, voice and data communications products and systems for private networks, wireless broadband systems and end-to-end enterprise mobility solutions to a wide range of enterprise markets.
Workday Inc. (WDAY - Free Report) , currently sporting a Zacks Rank #1, delivered an earnings surprise of 15.38%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 14.40%.
Workday is a provider of enterprise-level software solutions for financial management and human resource domains. The company’s cloud-based platform combines finance and HR in a single system, which makes it easier for organizations to provide analytical insights and decision support.
NVIDIA Corporation (NVDA - Free Report) , currently sporting a Zacks Rank #1, delivered an earnings surprise of 9.79%, on average, in the trailing four quarters. In the last reported quarter, it pulled off an earnings surprise of 29.19%.
NVIDIA is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence-based solutions that now support high-performance computing, gaming and virtual reality platforms.