Harmonic Inc (HLIT) Q3 2024 Earnings Call Highlights: Record Revenue Growth and Strategic ...

In This Article:

  • Total Revenue: $195.8 million, a 54% increase year over year.

  • Broadband Revenue: $145.3 million, up 92% year over year.

  • Video Revenue: $50.4 million, with SaaS streaming revenue of $14.2 million, up 13.1% year over year.

  • Gross Margin: 53.7%, above the high end of guidance.

  • Broadband Gross Margin: 48.3%, up 380 basis points year over year.

  • Video Gross Margin: 69%, up 1,210 basis points year over year.

  • Adjusted EBITDA: $43.4 million, with $37.5 million from Broadband and $6 million from Video.

  • EPS: $0.26 per share.

  • Bookings: $171.4 million, with a book-to-bill ratio of 0.9.

  • Backlog and Deferred Revenue: $584.7 million.

  • Cash and Cash Equivalents: $58.2 million.

  • Free Cash Flow: $5.7 million.

  • Days Sales Outstanding (DSO): 80 days.

  • Days Inventory on Hand: 73 days.

  • Q4 2024 Revenue Guidance: $205 million to $220 million.

  • Q4 2024 EPS Guidance: $0.33 to $0.39.

Release Date: October 28, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Harmonic Inc (NASDAQ:HLIT) reported record Q3 results with total revenue and adjusted EBITDA exceeding guidance.

  • The Broadband segment saw a significant revenue increase of 92% year-over-year, driven by strong customer demand and market leadership.

  • The Video segment returned to profitability with a greater than 10% adjusted EBITDA margin, aided by rightsizing actions and revenue execution.

  • Harmonic Inc (NASDAQ:HLIT) secured business with 7 new customers in the Broadband segment, highlighting growing demand for modernized cable network solutions.

  • The company reaffirmed its full-year Broadband 2024 revenue guidance and raised its EBITDA guidance, indicating confidence in future performance.

Negative Points

  • There are short-term challenges anticipated in 2025 due to ecosystem integration requirements and new Unified RF front-end development.

  • Customer deployment timing plans are being pushed out, creating a short-term Broadband revenue headwind in 2025.

  • The Video segment's revenue was slightly down compared to the previous year, indicating ongoing challenges in this market.

  • The company faces dependency on the availability and maturity of amplifiers for future deployments, which could impact growth.

  • Customer concentration remains high, with Comcast and Charter representing a significant portion of total revenue, indicating a need for diversification.

Q & A Highlights

Q: Can you explain the upside in broadband for the September quarter? Was it primarily timing, and can you provide any color on product mix affecting margins? A: The higher-than-expected results were due to delivery timing and our ability to ship products to customers. We reaffirmed our full-year guidance for broadband, indicating a shift rather than an increase. The product mix shifted slightly, leading to improved gross margins in Q3. - Walter Jankovic, CFO