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Why Is iRobot (IRBT) Up 10.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for iRobot (IRBT - Free Report) . Shares have added about 10.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is iRobot due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
iRobot Q1 Earnings & Revenues Miss Estimates
iRobot incurred an adjusted loss of $1.96 per share in the first quarter of 2023, wider than the Zacks Consensus Estimate of a loss of $1.56 per share. Also, the quarterly loss compared unfavorably with a loss of 87 cents recorded in the year-ago quarter.
Revenue Details
iRobot generated revenues of $160.3 million in the reported quarter, missing the Zacks Consensus Estimate of $241 million by 33.4%. On a year-over-year basis, revenues decreased 45.1% due to lower orders.
Sales derived from premium and mid-tier robots accounted for 88% of IRBT’s total robot revenues, higher than 86% in the year-ago quarter.
Sales generated from the e-commerce platform (representing 57% of the reported quarter’s revenues) decreased 50% year over year. The e-commerce platform includes online sources of retailers, IRBT’s app and website, as well as e-commerce websites. Direct sales to consumers were down 6% year over year to $38.3 million.
Total product units of 436 thousand shipped in the quarter reflected a year-over-year decrease of 55.2%, while average selling prices increased 20.7%. For vacuum products, revenues of $146 million reflected a decline of 43.6% from the year-ago quarter. Units shipped were 399 thousand, down 57.6% from the prior-year quarter. Revenues from mopping products decreased 66.1% to $14 million. Units shipped were 37 thousand, down from 109 thousand recorded in the year-ago quarter.
On a regional basis, iRobot sourced 44.9% of revenues from domestic operations and the rest came from the international arena. Domestic revenues totaled $72 million, reflecting a 53% decline from the year-ago quarter. International revenues moved down 36.4% to $88.3 million.
Margin Profile
In the quarter under review, iRobot’s cost of revenues decreased 32.9% to $123.7 million, representing 77.2% of revenues compared with 63.2% in the year-ago quarter. Adjusted gross profit was $37.9 million, down 62.3% year over year, while the adjusted gross margin decreased 1080 basis points to 23.7%.
Research and development expenses were $41.9 million, down 1.4% year over year. This accounted for 26.1% of revenues compared with 8.9% in the year-ago quarter. Selling and marketing expenses decreased 26.7% to $44.8 million. As a percentage of revenues, it was 27.9% for the reported quarter compared with 20.9% in the prior-year period. General and administrative expenses were $31 million, up 16% year over year. The figure mirrored 19.3% of the total revenue base compared with 9.1% in the year-earlier quarter.
In the first quarter, iRobot recorded an adjusted operating loss of $62.2 million against an operating income of $18.5 million in the year-ago period. The adjusted operating margin was (38.8%) versus (6.3%) in the year-ago quarter.
Balance Sheet and Cash Flow
While exiting first-quarter 2023, iRobot had cash and cash equivalents of $47.9 million, which decreased 59.4% from $117.9 million recorded at the end of fourth-quarter 2022. Total long-term liabilities were $55.2 million, down 13.2% from the figure recorded at the end of fourth-quarter 2022.
In the first three months of 2023, iRobot used net cash of $94.5 million for operating activities compared with net cash of $102.3 million used in the prior-year period. Capital used for purchasing property and equipment totaled $1.5 million, decreasing 53.2%.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -15.1% due to these changes.
VGM Scores
At this time, iRobot has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise iRobot has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
iRobot is part of the Zacks Industrial Automation and Robotics industry. Over the past month, Rockwell Automation (ROK - Free Report) , a stock from the same industry, has gained 10.7%. The company reported its results for the quarter ended March 2023 more than a month ago.
Rockwell Automation reported revenues of $2.28 billion in the last reported quarter, representing a year-over-year change of +25.8%. EPS of $3.01 for the same period compares with $1.66 a year ago.
For the current quarter, Rockwell Automation is expected to post earnings of $3.23 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.5% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Rockwell Automation. Also, the stock has a VGM Score of D.
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Why Is iRobot (IRBT) Up 10.3% Since Last Earnings Report?
A month has gone by since the last earnings report for iRobot (IRBT - Free Report) . Shares have added about 10.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is iRobot due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
iRobot Q1 Earnings & Revenues Miss Estimates
iRobot incurred an adjusted loss of $1.96 per share in the first quarter of 2023, wider than the Zacks Consensus Estimate of a loss of $1.56 per share. Also, the quarterly loss compared unfavorably with a loss of 87 cents recorded in the year-ago quarter.
Revenue Details
iRobot generated revenues of $160.3 million in the reported quarter, missing the Zacks Consensus Estimate of $241 million by 33.4%. On a year-over-year basis, revenues decreased 45.1% due to lower orders.
Sales derived from premium and mid-tier robots accounted for 88% of IRBT’s total robot revenues, higher than 86% in the year-ago quarter.
Sales generated from the e-commerce platform (representing 57% of the reported quarter’s revenues) decreased 50% year over year. The e-commerce platform includes online sources of retailers, IRBT’s app and website, as well as e-commerce websites. Direct sales to consumers were down 6% year over year to $38.3 million.
Total product units of 436 thousand shipped in the quarter reflected a year-over-year decrease of 55.2%, while average selling prices increased 20.7%. For vacuum products, revenues of $146 million reflected a decline of 43.6% from the year-ago quarter. Units shipped were 399 thousand, down 57.6% from the prior-year quarter. Revenues from mopping products decreased 66.1% to $14 million. Units shipped were 37 thousand, down from 109 thousand recorded in the year-ago quarter.
On a regional basis, iRobot sourced 44.9% of revenues from domestic operations and the rest came from the international arena. Domestic revenues totaled $72 million, reflecting a 53% decline from the year-ago quarter. International revenues moved down 36.4% to $88.3 million.
Margin Profile
In the quarter under review, iRobot’s cost of revenues decreased 32.9% to $123.7 million, representing 77.2% of revenues compared with 63.2% in the year-ago quarter. Adjusted gross profit was $37.9 million, down 62.3% year over year, while the adjusted gross margin decreased 1080 basis points to 23.7%.
Research and development expenses were $41.9 million, down 1.4% year over year. This accounted for 26.1% of revenues compared with 8.9% in the year-ago quarter. Selling and marketing expenses decreased 26.7% to $44.8 million. As a percentage of revenues, it was 27.9% for the reported quarter compared with 20.9% in the prior-year period. General and administrative expenses were $31 million, up 16% year over year. The figure mirrored 19.3% of the total revenue base compared with 9.1% in the year-earlier quarter.
In the first quarter, iRobot recorded an adjusted operating loss of $62.2 million against an operating income of $18.5 million in the year-ago period. The adjusted operating margin was (38.8%) versus (6.3%) in the year-ago quarter.
Balance Sheet and Cash Flow
While exiting first-quarter 2023, iRobot had cash and cash equivalents of $47.9 million, which decreased 59.4% from $117.9 million recorded at the end of fourth-quarter 2022. Total long-term liabilities were $55.2 million, down 13.2% from the figure recorded at the end of fourth-quarter 2022.
In the first three months of 2023, iRobot used net cash of $94.5 million for operating activities compared with net cash of $102.3 million used in the prior-year period. Capital used for purchasing property and equipment totaled $1.5 million, decreasing 53.2%.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -15.1% due to these changes.
VGM Scores
At this time, iRobot has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise iRobot has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
iRobot is part of the Zacks Industrial Automation and Robotics industry. Over the past month, Rockwell Automation (ROK - Free Report) , a stock from the same industry, has gained 10.7%. The company reported its results for the quarter ended March 2023 more than a month ago.
Rockwell Automation reported revenues of $2.28 billion in the last reported quarter, representing a year-over-year change of +25.8%. EPS of $3.01 for the same period compares with $1.66 a year ago.
For the current quarter, Rockwell Automation is expected to post earnings of $3.23 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.5% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Rockwell Automation. Also, the stock has a VGM Score of D.