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Viavi's (VIAV) Q4 Earnings Beat Estimates, Revenues Fall Y/Y
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Viavi Solutions Inc. (VIAV - Free Report) reported modest fourth-quarter fiscal 2024 results, wherein the top line matched the Zacks Consensus Estimate, and the bottom line beat the same. However, sluggish demand trends in all verticals, a constrained spending environment owing to macroeconomic challenges and inventory adjustments led to lower revenues year over year.
Net Income
On a GAAP basis, Viavi incurred a net loss of $21.7 million or a loss of 10 cents per share compared with a net loss of $0.1 million or break-even earnings per share in the year-ago quarter.
Excluding non-recurring items, non-GAAP net income was $17.1 million or 8 cents per share, down from $22.7 million or 10 cents per share in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate by a penny.
In fiscal 2024, the company reported a net loss of $25.8 million or a loss of 12 cents per share against a net income of $25.5 million or 11 cents per share in fiscal 2023. Viavi registered a non-GAAP net income of $73.5 million or 33 cents per share in fiscal 2024 compared with $124.7 million or 55 cents per share in fiscal 2023.
Viavi Solutions Inc. Price, Consensus and EPS Surprise
Total revenues were $252 million compared with $263.6 million in the year-ago quarter. Soft demand trends in the smartphone market and 3D sensing products affected revenue growth. However, robust demand from avionics customers supported the top line in the June quarter. The top line was in line with the Zacks Consensus Estimate.
In fiscal 2024, the company generated $1 billion in net sales compared with $1.1 billion in fiscal 2023.
Net sales from Network Enablement (NE) were $158.5 million, down from $175.5 million in the year-ago quarter. Weak demand trends, owing to a constrained spending environment, led to a 9.7% year-over-year decline in the quarter. However, gradual recovery in lab and production test equipment from wireless and fiber NEMs and semiconductor companies partially cushioned the top line in this segment.
Revenues from the Service Enablement (SE) segment were $23.7 million, up 5.8% year over year owing to railway acquisition.
Optical Security and Performance Products (OSP) revenues were $69.8 million, up 6.2% from the year-earlier quarter’s tally of $65.7 million.
Net sales from America contributed $98.8 million to revenues, down from $108.3 million reported in the year-ago quarter. Revenues from Asia-Pacific stood at $91.4 million, up 7.2% year over year. Revenues from EMEA declined to $61.8 million from prior-year quarter’s tally of $70 million.
Other Details
In the fiscal fourth quarter, the non-GAAP gross margin was 59.6%, up from 58.2% from the prior-year quarter. Non-GAAP gross margin in the NE segment was 61.3%, down 40 basis points year over year due to lower volume and product mix. SE segment’s gross margin improved to 67.5% from 65.6% in the prior-year quarter.
Non-GAAP operating margin declined to 10.9%, down 80 bps year over year. Operating margin in the Network and Service Enablement business was 1.8% compared with 5.8% in the year-ago quarter. OSP segment’s operating margin increased to 34.8% from 29.5% in the prior-year quarter.
Cash Flow & Liquidity
In fiscal 2024, Viavi generated $116.4 million of cash from operating activities. As of Jun 29, 2024, the company had $471.3 million in cash and cash equivalents with $636 million of long-term debt compared with the respective figures of $506.5 million and $629.5 million in the year-ago quarter.
Outlook
For the first quarter of fiscal 2025, management expects revenues in the range of $235-$245 million. Non-GAAP operating margin is expected to be in the range of 9.9%-11.7%, with non-GAAP earnings per share between 5 and 7 cents.
For the Network and Service Enablement segment, revenues are projected to be between $160 and $168 million. Revenues for the OSP segment are anticipated to be in the band of $75-$77 million, with a non-GAAP operating margin of 33-35%.
Cisco Systems, Inc. (CSCO - Free Report) is scheduled to release fourth quarter fiscal 2024 results on Aug 14. The Zacks Consensus Estimate for earnings is pegged at 85 cents per share, which indicates a decline of 25.44% from the year-ago reported figure.
Palo Alto Networks (PANW - Free Report) is scheduled to release fourth-quarter fiscal 2024 results on Aug 19. The Zacks Consensus Estimate for earnings is pegged at $1.41 per share, which indicates a decline of 2.08% from the year-ago reported figure.
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2024 results on Aug 20. The Zacks Consensus Estimate for earnings is pegged at $1.35 per share, indicating a decline of 38.4% from the year-ago reported figure.
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Viavi's (VIAV) Q4 Earnings Beat Estimates, Revenues Fall Y/Y
Viavi Solutions Inc. (VIAV - Free Report) reported modest fourth-quarter fiscal 2024 results, wherein the top line matched the Zacks Consensus Estimate, and the bottom line beat the same. However, sluggish demand trends in all verticals, a constrained spending environment owing to macroeconomic challenges and inventory adjustments led to lower revenues year over year.
Net Income
On a GAAP basis, Viavi incurred a net loss of $21.7 million or a loss of 10 cents per share compared with a net loss of $0.1 million or break-even earnings per share in the year-ago quarter.
Excluding non-recurring items, non-GAAP net income was $17.1 million or 8 cents per share, down from $22.7 million or 10 cents per share in the year-earlier quarter. The bottom line beat the Zacks Consensus Estimate by a penny.
In fiscal 2024, the company reported a net loss of $25.8 million or a loss of 12 cents per share against a net income of $25.5 million or 11 cents per share in fiscal 2023. Viavi registered a non-GAAP net income of $73.5 million or 33 cents per share in fiscal 2024 compared with $124.7 million or 55 cents per share in fiscal 2023.
Viavi Solutions Inc. Price, Consensus and EPS Surprise
Viavi Solutions Inc. price-consensus-eps-surprise-chart | Viavi Solutions Inc. Quote
Revenues
Total revenues were $252 million compared with $263.6 million in the year-ago quarter. Soft demand trends in the smartphone market and 3D sensing products affected revenue growth. However, robust demand from avionics customers supported the top line in the June quarter. The top line was in line with the Zacks Consensus Estimate.
In fiscal 2024, the company generated $1 billion in net sales compared with $1.1 billion in fiscal 2023.
Net sales from Network Enablement (NE) were $158.5 million, down from $175.5 million in the year-ago quarter. Weak demand trends, owing to a constrained spending environment, led to a 9.7% year-over-year decline in the quarter. However, gradual recovery in lab and production test equipment from wireless and fiber NEMs and semiconductor companies partially cushioned the top line in this segment.
Revenues from the Service Enablement (SE) segment were $23.7 million, up 5.8% year over year owing to railway acquisition.
Optical Security and Performance Products (OSP) revenues were $69.8 million, up 6.2% from the year-earlier quarter’s tally of $65.7 million.
Net sales from America contributed $98.8 million to revenues, down from $108.3 million reported in the year-ago quarter. Revenues from Asia-Pacific stood at $91.4 million, up 7.2% year over year. Revenues from EMEA declined to $61.8 million from prior-year quarter’s tally of $70 million.
Other Details
In the fiscal fourth quarter, the non-GAAP gross margin was 59.6%, up from 58.2% from the prior-year quarter. Non-GAAP gross margin in the NE segment was 61.3%, down 40 basis points year over year due to lower volume and product mix. SE segment’s gross margin improved to 67.5% from 65.6% in the prior-year quarter.
Non-GAAP operating margin declined to 10.9%, down 80 bps year over year. Operating margin in the Network and Service Enablement business was 1.8% compared with 5.8% in the year-ago quarter. OSP segment’s operating margin increased to 34.8% from 29.5% in the prior-year quarter.
Cash Flow & Liquidity
In fiscal 2024, Viavi generated $116.4 million of cash from operating activities. As of Jun 29, 2024, the company had $471.3 million in cash and cash equivalents with $636 million of long-term debt compared with the respective figures of $506.5 million and $629.5 million in the year-ago quarter.
Outlook
For the first quarter of fiscal 2025, management expects revenues in the range of $235-$245 million. Non-GAAP operating margin is expected to be in the range of 9.9%-11.7%, with non-GAAP earnings per share between 5 and 7 cents.
For the Network and Service Enablement segment, revenues are projected to be between $160 and $168 million. Revenues for the OSP segment are anticipated to be in the band of $75-$77 million, with a non-GAAP operating margin of 33-35%.
Zacks Rank
Viavi currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Cisco Systems, Inc. (CSCO - Free Report) is scheduled to release fourth quarter fiscal 2024 results on Aug 14. The Zacks Consensus Estimate for earnings is pegged at 85 cents per share, which indicates a decline of 25.44% from the year-ago reported figure.
Palo Alto Networks (PANW - Free Report) is scheduled to release fourth-quarter fiscal 2024 results on Aug 19. The Zacks Consensus Estimate for earnings is pegged at $1.41 per share, which indicates a decline of 2.08% from the year-ago reported figure.
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2024 results on Aug 20. The Zacks Consensus Estimate for earnings is pegged at $1.35 per share, indicating a decline of 38.4% from the year-ago reported figure.