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Advanced Energy (AEIS) Q3 Earnings Beat, Revenues Rise Y/Y
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Advanced Energy Industries, Inc. (AEIS - Free Report) reported third-quarter 2022 non-GAAP earnings of $2.12 per share, beating the Zacks Consensus Estimate by 53.6%. Further, the bottom line increased 138.2% and 47.2% from the year-ago quarter and the previous quarter’s levels, respectively.
Revenues of $516.3 million surpassed the Zacks Consensus Estimate of $444.4 million. The top line improved 49.2% and 17.1% year over year and sequentially, respectively.
Strong momentum across the semiconductor equipment, data center computing, telecom and networking, and industrial and medical end markets drove the top line.
Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise
Semiconductor Equipment: Revenues generated from the market grew 54% year over year to $266.6 million (51.6% of the total revenues), driven by the growing momentum across dielectric etch, conductor etch and RPS technologies.
Industrial & Medical: Revenues from the market grew 48% year over year to $119.6 million (23.2% of the total revenues) in the reported quarter. Top-line growth in the market was driven by growing design wins in surgical science and EV charging. Strengthening alliance with Tier-1 OEMs in the medical market was a positive.
Data Center Computing: Revenues from the market were $87.5 million (17% of the total revenues), up 41% from the year-ago quarter’s level.
Telecom & Networking: Revenues generated from the market were $42.5 million (8.2% of the total revenues), up 44% from the prior-year quarter’s level.
Operating Results
In the third quarter, GAAP’s gross profit was 37%, which expanded 230 basis points (bps) year over year. The non-GAAP gross profit margin was 37.5%, which expanded 140 bps from the year-ago quarter’s level.
Non-GAAP operating expenses were $99.8 million, up 19.3% year over year. As a percentage of revenues, the figure contracted 490 bps year over year to 19.3% in the reported quarter.
The non-GAAP operating margin was 18.1%, expanding 620 bps from the prior-year quarter’s level.
Balance Sheet & Cash Flow
As of Sep 30, 2022, cash and cash equivalents were $409.05 million compared with $372.7 million as of Jun 30, 2022.
Total debt was $378.1 million at the third-quarter end, down from $383 million at the second-quarter end.
For the third quarter, cash flow from operations was $65.4 million, which jumped from $37.6 million in the second quarter.
Advanced Energy made dividend payments of $3.8 million and repurchased shares worth $2.4 million in the quarter.
Guidance
For fourth-quarter 2022, Advanced Energy expects non-GAAP earnings of $1.55 per share (+/- 25 cents). The Zacks Consensus Estimate is pegged at $1.56 per share.
Advanced Energy anticipates revenues of $470 million (+/- $20 million). The Zacks Consensus Estimate for the same is pegged at $453.95 million.
Zacks Rank & Stocks to Consider
Currently, Advanced Energy has a Zacks Rank #4 (Sell).
US Foods is set to report third-quarter 2022 results on Nov 10. The Zacks Consensus Estimate for USFD’s earnings is pegged at 59 cents per share, suggesting an increase of 22.9% from the prior-year period’s reported figure. USFD has lost 15% in the year-to-date period. Its long-term earnings growth rate is currently projected at 20%.
The Trade Desk is scheduled to release third-quarter 2022 results on Nov 9. The Zacks Consensus Estimate for TTD’s earnings is pegged at 24 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure. TTD has lost 42% in the year-to-date period. TTD’s long-term earnings growth rate is currently projected at 24%.
Tencent Music is scheduled to release third-quarter 2022 results on Nov 15. The Zacks Consensus Estimate for TME’s earnings is pegged at 11 cents per share, suggesting an increase of 22.2% from the prior-year quarter’s reported figure. TME has lost 45.2% in the year-to-date period. TME’s long-term earnings growth rate is currently projected at 17.9%.
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Advanced Energy (AEIS) Q3 Earnings Beat, Revenues Rise Y/Y
Advanced Energy Industries, Inc. (AEIS - Free Report) reported third-quarter 2022 non-GAAP earnings of $2.12 per share, beating the Zacks Consensus Estimate by 53.6%. Further, the bottom line increased 138.2% and 47.2% from the year-ago quarter and the previous quarter’s levels, respectively.
Revenues of $516.3 million surpassed the Zacks Consensus Estimate of $444.4 million. The top line improved 49.2% and 17.1% year over year and sequentially, respectively.
Strong momentum across the semiconductor equipment, data center computing, telecom and networking, and industrial and medical end markets drove the top line.
Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise
Advanced Energy Industries, Inc. price-consensus-eps-surprise-chart | Advanced Energy Industries, Inc. Quote
End Market in Detail
Semiconductor Equipment: Revenues generated from the market grew 54% year over year to $266.6 million (51.6% of the total revenues), driven by the growing momentum across dielectric etch, conductor etch and RPS technologies.
Industrial & Medical: Revenues from the market grew 48% year over year to $119.6 million (23.2% of the total revenues) in the reported quarter. Top-line growth in the market was driven by growing design wins in surgical science and EV charging. Strengthening alliance with Tier-1 OEMs in the medical market was a positive.
Data Center Computing: Revenues from the market were $87.5 million (17% of the total revenues), up 41% from the year-ago quarter’s level.
Telecom & Networking: Revenues generated from the market were $42.5 million (8.2% of the total revenues), up 44% from the prior-year quarter’s level.
Operating Results
In the third quarter, GAAP’s gross profit was 37%, which expanded 230 basis points (bps) year over year. The non-GAAP gross profit margin was 37.5%, which expanded 140 bps from the year-ago quarter’s level.
Non-GAAP operating expenses were $99.8 million, up 19.3% year over year. As a percentage of revenues, the figure contracted 490 bps year over year to 19.3% in the reported quarter.
The non-GAAP operating margin was 18.1%, expanding 620 bps from the prior-year quarter’s level.
Balance Sheet & Cash Flow
As of Sep 30, 2022, cash and cash equivalents were $409.05 million compared with $372.7 million as of Jun 30, 2022.
Total debt was $378.1 million at the third-quarter end, down from $383 million at the second-quarter end.
For the third quarter, cash flow from operations was $65.4 million, which jumped from $37.6 million in the second quarter.
Advanced Energy made dividend payments of $3.8 million and repurchased shares worth $2.4 million in the quarter.
Guidance
For fourth-quarter 2022, Advanced Energy expects non-GAAP earnings of $1.55 per share (+/- 25 cents). The Zacks Consensus Estimate is pegged at $1.56 per share.
Advanced Energy anticipates revenues of $470 million (+/- $20 million). The Zacks Consensus Estimate for the same is pegged at $453.95 million.
Zacks Rank & Stocks to Consider
Currently, Advanced Energy has a Zacks Rank #4 (Sell).
Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like US Foods (USFD - Free Report) , The Trade Desk (TTD - Free Report) and Tencent Music Entertainment Group (TME - 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.
US Foods is set to report third-quarter 2022 results on Nov 10. The Zacks Consensus Estimate for USFD’s earnings is pegged at 59 cents per share, suggesting an increase of 22.9% from the prior-year period’s reported figure. USFD has lost 15% in the year-to-date period. Its long-term earnings growth rate is currently projected at 20%.
The Trade Desk is scheduled to release third-quarter 2022 results on Nov 9. The Zacks Consensus Estimate for TTD’s earnings is pegged at 24 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure. TTD has lost 42% in the year-to-date period. TTD’s long-term earnings growth rate is currently projected at 24%.
Tencent Music is scheduled to release third-quarter 2022 results on Nov 15. The Zacks Consensus Estimate for TME’s earnings is pegged at 11 cents per share, suggesting an increase of 22.2% from the prior-year quarter’s reported figure. TME has lost 45.2% in the year-to-date period. TME’s long-term earnings growth rate is currently projected at 17.9%.