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Ubiquiti (UI) Beats on Q4 Earnings Despite Lower Revenues
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Ubiquiti Inc. (UI - Free Report) reported mixed fourth-quarter fiscal 2022 results, with both the bottom line and the top line beating the respective Zacks Consensus Estimate despite decreasing year over year. The lower figures were primarily due to supply chain disruptions and continued COVID setbacks around the world that led the company to falter on the customer order fulfillment schedule. In addition, high raw material prices due to component shortages eroded Ubiquiti’s profitability.
Net Income
On a GAAP basis, net income in fourth-quarter fiscal 2022 was $92.5 million, down from $154.3 million in the year-earlier quarter. The decline was primarily due to top-line contraction and higher operating expenses as it continues to incur additional expenses to expedite deliveries of components and services. On a per share basis, GAAP net income was $1.53, which beat the Zacks Consensus Estimate of $1.24.
Quarterly non-GAAP net income was $93.3 million or $1.54 per share compared with $154.9 million or $2.47 per share in the year-ago quarter. In fiscal 2022, GAAP net income declined to $378.7 million or $6.13 per share from $616.6 million or $9.78 per share in fiscal 2021. Non-GAAP net income in fiscal 2022 was $380.4 million or $6.16 per share compared with $615.8 million or $9.77 per share in fiscal 2021.
Quarterly revenues were down 7.3% year over year to $443.1 million due to lower sales of Service Provider Technology as supply chain turmoil led to a shortage of essential components and increased input costs. Total revenues surpassed the consensus estimate of $387 million. In fiscal 2022, total revenues aggregated $1,691.7 million compared with $1,898.1 million in fiscal 2021.
Revenues from Service Provider Technology decreased to $98.6 million from $163.5 million in the year-ago quarter, with lower revenues in four regions across all the platforms. Enterprise Technology revenues were $344.5 million, up from $314.4 million due to higher revenues from the UniFi technology platform.
Region-wise, revenues from North America were $211.1 million compared with $212.2 million in the year-ago quarter while that from Europe, the Middle East and Africa totaled $176.5 million, down from $197.8 million. Revenues from the Asia Pacific were $32.8 million compared with $39.1 million a year ago and the same from South America totaled $22.8 million, down from $28.8 million.
Other Details
Gross profit declined 26.5% year over year to $169.6 million due to higher shipping costs, increased components costs and higher tariffs. Increased fees associated with webstore credit card processing and professional fees dragged the SG&A expenses to $19.6 million from $17 million a year ago. Operating income declined to $112.6 million from $182.8 million, owing to higher operating expenses and top-line contraction.
Cash Flow & Liquidity
In fiscal 2022, Ubiquiti generated $370.3 million of cash from operating activities compared with $612 million in the prior-year period. As of Jun 30, 2022, the company had $136.2 million in cash and cash equivalents with $762.6 million of long-term debt compared with the respective tallies of $249.4 million and $467 million in the prior-year period. During the quarter, Ubiquiti repurchased 363,614 shares at an average price of $289.11 each.
Zacks Rank & Stocks to Consider
Ubiquiti currently carries a Zacks Rank #3 (Hold).
Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1 (Strong Buy), is a solid pick for investors in the industry. You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered an earnings surprise of 33.9%, on average, in the trailing four quarters. Earnings estimates for the current year for the stock have moved up 101.9% since August 2021. Over the past year, Clearfield has gained a solid 165%.
Viasat, Inc. (VSAT - Free Report) , carrying a Zacks Rank #2 (Buy), is another key pick. The company attracts millions of U.S. consumers and enterprises with its high-quality broadband service.
Viasat’s impressive bandwidth productivity sets it apart from conventional and lower-yield satellite providers that run on incumbent business models. Viasat has a competitive advantage in bandwidth economics, global coverage, flexibility and bandwidth allocation, making it believe that mobile broadband will act as a profit churner.
Aviat Networks, Inc. (AVNW - Free Report) sports a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has been revised 19.8% upward since August 2021.
Aviat Networks pulled off a trailing four-quarter earnings surprise of 15.9%, on average. It has soared 200.8% in the past two years.
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Ubiquiti (UI) Beats on Q4 Earnings Despite Lower Revenues
Ubiquiti Inc. (UI - Free Report) reported mixed fourth-quarter fiscal 2022 results, with both the bottom line and the top line beating the respective Zacks Consensus Estimate despite decreasing year over year. The lower figures were primarily due to supply chain disruptions and continued COVID setbacks around the world that led the company to falter on the customer order fulfillment schedule. In addition, high raw material prices due to component shortages eroded Ubiquiti’s profitability.
Net Income
On a GAAP basis, net income in fourth-quarter fiscal 2022 was $92.5 million, down from $154.3 million in the year-earlier quarter. The decline was primarily due to top-line contraction and higher operating expenses as it continues to incur additional expenses to expedite deliveries of components and services. On a per share basis, GAAP net income was $1.53, which beat the Zacks Consensus Estimate of $1.24.
Quarterly non-GAAP net income was $93.3 million or $1.54 per share compared with $154.9 million or $2.47 per share in the year-ago quarter. In fiscal 2022, GAAP net income declined to $378.7 million or $6.13 per share from $616.6 million or $9.78 per share in fiscal 2021. Non-GAAP net income in fiscal 2022 was $380.4 million or $6.16 per share compared with $615.8 million or $9.77 per share in fiscal 2021.
Ubiquiti Inc. Price, Consensus and EPS Surprise
Ubiquiti Inc. price-consensus-eps-surprise-chart | Ubiquiti Inc. Quote
Revenues
Quarterly revenues were down 7.3% year over year to $443.1 million due to lower sales of Service Provider Technology as supply chain turmoil led to a shortage of essential components and increased input costs. Total revenues surpassed the consensus estimate of $387 million. In fiscal 2022, total revenues aggregated $1,691.7 million compared with $1,898.1 million in fiscal 2021.
Revenues from Service Provider Technology decreased to $98.6 million from $163.5 million in the year-ago quarter, with lower revenues in four regions across all the platforms. Enterprise Technology revenues were $344.5 million, up from $314.4 million due to higher revenues from the UniFi technology platform.
Region-wise, revenues from North America were $211.1 million compared with $212.2 million in the year-ago quarter while that from Europe, the Middle East and Africa totaled $176.5 million, down from $197.8 million. Revenues from the Asia Pacific were $32.8 million compared with $39.1 million a year ago and the same from South America totaled $22.8 million, down from $28.8 million.
Other Details
Gross profit declined 26.5% year over year to $169.6 million due to higher shipping costs, increased components costs and higher tariffs. Increased fees associated with webstore credit card processing and professional fees dragged the SG&A expenses to $19.6 million from $17 million a year ago. Operating income declined to $112.6 million from $182.8 million, owing to higher operating expenses and top-line contraction.
Cash Flow & Liquidity
In fiscal 2022, Ubiquiti generated $370.3 million of cash from operating activities compared with $612 million in the prior-year period. As of Jun 30, 2022, the company had $136.2 million in cash and cash equivalents with $762.6 million of long-term debt compared with the respective tallies of $249.4 million and $467 million in the prior-year period. During the quarter, Ubiquiti repurchased 363,614 shares at an average price of $289.11 each.
Zacks Rank & Stocks to Consider
Ubiquiti currently carries a Zacks Rank #3 (Hold).
Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1 (Strong Buy), is a solid pick for investors in the industry. You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered an earnings surprise of 33.9%, on average, in the trailing four quarters. Earnings estimates for the current year for the stock have moved up 101.9% since August 2021. Over the past year, Clearfield has gained a solid 165%.
Viasat, Inc. (VSAT - Free Report) , carrying a Zacks Rank #2 (Buy), is another key pick. The company attracts millions of U.S. consumers and enterprises with its high-quality broadband service.
Viasat’s impressive bandwidth productivity sets it apart from conventional and lower-yield satellite providers that run on incumbent business models. Viasat has a competitive advantage in bandwidth economics, global coverage, flexibility and bandwidth allocation, making it believe that mobile broadband will act as a profit churner.
Aviat Networks, Inc. (AVNW - Free Report) sports a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has been revised 19.8% upward since August 2021.
Aviat Networks pulled off a trailing four-quarter earnings surprise of 15.9%, on average. It has soared 200.8% in the past two years.