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• Revenue: $162.1 million, down 11.2% sequentially and down 1.5% year over year.

• NFB Segment Revenue: $79.2 million, down 2% sequentially and up 15.4% year over year.

• Mobile Business Revenue: $21.5 million, down 25.3% year over year and down 10.9% sequentially.

• Home Networking Revenue: $61.4 million, down 8.7% year over year and down 20.8% sequentially.

• Non-GAAP Gross Margin: 35%, up 550 basis points year over year.

• NFB Gross Margin: 46.3%, up 440 basis points year over year.

• Mobile Segment Gross Margin: 24.6%, up 730 basis points year over year.

• Home Networking Gross Margin: 24.1%, up 190 basis points year over year.

• Non-GAAP Operating Expenses: $59.3 million, down 8.2% year over year.

• Non-GAAP Operating Margin: Negative 1.6%, an improvement of 810 basis points year over year.

• Non-GAAP Net Income: Approximately $460,000, resulting in earnings of $0.02 per share.

• Cash and Short Term Investments: $391.9 million.

• Free Cash Flow: Negative $10.1 million.

• Recurring Service Revenue: $8.7 million, a year-over-year increase of 19.3%.

• Share Repurchase: $7.5 million spent to repurchase approximately 254,000 shares.

• Warning! GuruFocus has detected 4 Warning Sign with NTGR.

Release Date: April 30, 2025

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

Positive Points

• Netgear Inc (NASDAQ:NTGR) outperformed its guidance for revenue and operating margin, driven by strong contributions from its B2B division, NETGEAR for Business.

• The company achieved a non-GAAP gross margin of 35%, highlighting improved supply chain execution and a stronger product mix.

• Revenue from the NETGEAR for Business segment increased by 15.4% year over year, with a 78% rise in contribution profit.

• Netgear Inc (NASDAQ:NTGR) gained market share in its Home Networking segment in the US and Europe, despite a competitive market.

• The acquisition of VAAG Systems enhances Netgear Inc (NASDAQ:NTGR)'s software development capabilities, allowing for more innovative product offerings and cost efficiencies.

Negative Points

• Netgear Inc (NASDAQ:NTGR) experienced a sequential revenue decline of 11.2% due to seasonality in its Home Networking business.

• The company faced supply constraints in its NETGEAR for Business segment, which may limit its ability to capture full top-line potential.

• Revenue for the Mobile business decreased by 25.3% year over year, indicating challenges in this segment.

• Netgear Inc (NASDAQ:NTGR) reported a negative free cash flow of $10.1 million due to changes in working capital.

• The company's non-GAAP operating margin was negative 1.6%, although it showed improvement compared to the prior year.