The following is a summary of the Aviat Networks, Inc. (AVNW) Q2 2024 Earnings Call Transcript:
Financial Performance:
Aviat Networks reported Q2 revenue of $95 million, a 4.8% YoY increase.
Gross margins for the quarter were 38.8%, up from 35.5% in the prior year.
GAAP operating expenses for the quarter increased by $8.3 million due to M&A related deal costs and higher R&D investments.
Operating income was $5.0 million on a GAAP basis, a decrease of 42% from the prior year.
GAAP net income for the quarter was down to $2.9 million from $6 million due to M&A related expenses.
Non-GAAP net income increased 7.3% to $11.9 million.
Business Progress:
The company completed the acquisition of NEC Wireless, now referred to as the Pasolink business.
Aviat has integrated the Pasolink business into their operating model framework and product offerings.
The company has a solid synergy roadmap to enhance their cost structure and improve gross margins, especially within the Pasolink business.
The company plans to reduce inventory levels to target levels, which would provide significant cash flow enhancement.
Supply chain improvements aiming at reduced lead times, lower working capital, and improved costs are in progress, estimated to take several quarters.
The company also announced a partnership with Smartfren Telecom to deliver wireless connectivity services in Indonesia.
Guidance for fiscal year 2024 has been raised to a revenue range of $425 million to $432 million, and adjusted EBITDA to be in the range of $51 million to $56 million. The Pasolink business is expected to contribute to this increased revenue.
More details: Aviat Networks IR
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