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IPG Photonics (IPGP - Free Report) reported earnings of 45 cents per share in second-quarter 2024, missing the Zacks Consensus Estimate by 6.25%. The company reported earnings of $1.31 per share in the year-ago quarter.
Revenues of $258 million declined 24% on a year-over-year basis but beat the consensus mark by 0.88%. Unfavorable forex hurt revenue growth by 2%.
The year-over-year decline was primarily due to lower sales in cutting and welding applications, although this was partially offset by growth in 3D printing, medical and advanced applications.
Emerging growth product sales contributed 46% to revenues, which improved sequentially driven by growth in handheld welding, medical and advanced applications.
IPG Photonics Corporation Price, Consensus and EPS Surprise
Materials processing (88% of total revenues) fell 28% year over year. The downside was mainly due to reduced revenues in cutting and welding applications due to weak demand from industrial and e-mobility customers.
Revenues from other applications increased 24% year over year, primarily due to higher revenues in medical and advanced applications.
Sales dropped 2% in North America, 34% in China and 39% in Japan on a year-over-year basis. Moreover, sales decreased 27% year over year in Europe.
IPG Photonics reported a gross margin of 37.3%, down 610 basis points on a year-over-year basis. The downside was primarily due to lower absorption of manufacturing expenses and higher inventory reserves, partially offset by reduced tariffs and shipping costs.
Balance Sheet
As of Jun 30, 2024, IPG Photonics had $1.06 billion in cash & cash equivalents compared with $1.14 billion as of Mar 31, 2024.
Second-quarter 2024 cash flow from operations amounted to $53 million compared with the previous quarter’s reported figure of $55 million.
In the second quarter, IPG generated $53 million in cash from operations compared with the previous quarter’s reported figure of $55 million. The company spent $24 million on capital expenditures and allocated $122 million for share repurchases.
Guidance
For third-quarter 2024, IPG Photonics anticipates sales to be $210-$240 million. Earnings are projected between break-even and 30 cents per share.
Zacks Rank & Stocks to Consider
IPG Photonics currently has a Zacks Rank #2 (Buy).
The stock has declined 19.2% year to date against the Zacks Computer & Technology sector’s increase of 18.2%.
Shopify (SHOP - Free Report) , Apple (AAPL - Free Report) and Cognizant Technology Solutions (CTSH - Free Report) are some other top-ranked stocks that investors can consider in the broader sector.
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IPG Photonics (IPGP) Q2 Earnings Miss, Revenues Decline Y/Y
IPG Photonics (IPGP - Free Report) reported earnings of 45 cents per share in second-quarter 2024, missing the Zacks Consensus Estimate by 6.25%. The company reported earnings of $1.31 per share in the year-ago quarter.
Revenues of $258 million declined 24% on a year-over-year basis but beat the consensus mark by 0.88%. Unfavorable forex hurt revenue growth by 2%.
The year-over-year decline was primarily due to lower sales in cutting and welding applications, although this was partially offset by growth in 3D printing, medical and advanced applications.
Emerging growth product sales contributed 46% to revenues, which improved sequentially driven by growth in handheld welding, medical and advanced applications.
IPG Photonics Corporation Price, Consensus and EPS Surprise
IPG Photonics Corporation price-consensus-eps-surprise-chart | IPG Photonics Corporation Quote
Quarterly Details
Materials processing (88% of total revenues) fell 28% year over year. The downside was mainly due to reduced revenues in cutting and welding applications due to weak demand from industrial and e-mobility customers.
Revenues from other applications increased 24% year over year, primarily due to higher revenues in medical and advanced applications.
Sales dropped 2% in North America, 34% in China and 39% in Japan on a year-over-year basis. Moreover, sales decreased 27% year over year in Europe.
IPG Photonics reported a gross margin of 37.3%, down 610 basis points on a year-over-year basis. The downside was primarily due to lower absorption of manufacturing expenses and higher inventory reserves, partially offset by reduced tariffs and shipping costs.
Balance Sheet
As of Jun 30, 2024, IPG Photonics had $1.06 billion in cash & cash equivalents compared with $1.14 billion as of Mar 31, 2024.
Second-quarter 2024 cash flow from operations amounted to $53 million compared with the previous quarter’s reported figure of $55 million.
In the second quarter, IPG generated $53 million in cash from operations compared with the previous quarter’s reported figure of $55 million. The company spent $24 million on capital expenditures and allocated $122 million for share repurchases.
Guidance
For third-quarter 2024, IPG Photonics anticipates sales to be $210-$240 million. Earnings are projected between break-even and 30 cents per share.
Zacks Rank & Stocks to Consider
IPG Photonics currently has a Zacks Rank #2 (Buy).
The stock has declined 19.2% year to date against the Zacks Computer & Technology sector’s increase of 18.2%.
Shopify (SHOP - Free Report) , Apple (AAPL - Free Report) and Cognizant Technology Solutions (CTSH - Free Report) are some other top-ranked stocks that investors can consider in the broader sector.
Shopify sports a Zacks Rank #1 (Strong Buy) at present, while Apple and Cognizant Technology Solutions carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shopify’s shares have declined 23.2% year to date. SHOP is set to report its second-quarter 2024 results on Aug 7.
Apple’s shares have increased 13.4% year to date. AAPL is set to report third-quarter fiscal 2024 results on Aug 1.
Cognizant Technology Solutions’ shares have moved down 1.3% year to date. CTSH is set to report second-quarter 2024 results on Jul 31.