Airgain Q3 sales slightly beat expectations; gross margin declines
Overview
Wireless connectivity provider's Q3 sales rose 9% yr/yr, slightly beating analyst expectations
Adjusted EPS for Q3 met analyst expectations
Company's gross margin declined due to higher sales of lower-margin enterprise IoT products
Outlook
Airgain expects Q4 sales between $15.5 mln and $17.5 mln
Company sees Q4 GAAP gross margin between 39.2% and 42.2%
Airgain expects Q4 non-GAAP net income per share of $0.05 at midpoint
Result Drivers
ENTERPRISE IOT GROWTH - Higher IoT modem shipments drove a $3.3 mln increase in enterprise sales, offsetting declines in other segments
PRODUCT MIX SHIFT - Gross margin declined due to an unfavorable shift in customer and product mix, with more lower-margin enterprise IoT sales and fewer higher-margin consumer products
SUPPLY CONSTRAINTS - Company said near-term supply constraints continued to affect portions of its business
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Sales | Slight Beat* | $15.32 mln | $15.24 mln (4 Analysts) |
Q3 Adjusted EPS | Meet | $0.04 | $0.04 (4 Analysts) |
Q3 Net Loss | $583,000 | ||
Q3 Gross Profit | $6.41 mln | ||
Q3 Income From Operations | -$456,000 | ||
Q3 Operating Expenses | $6.87 mln | ||
Q3 Pretax Loss | $598,000 |
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
The average consensus recommendation for the communications & networking peer group is "buy"
Wall Street's median 12-month price target for Airgain Inc is $9.00, about 108.8% above its November 9 closing price of $4.31
The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 28 three months ago
Reuters Recommended Reads
Nov 9 - Lantronix Q1 revenue beats estimates driven by embedded IoT solutions segment
Nov 10 - Germany's Infineon Q4 revenue rises sequentially
Nov 10 - Germany's Elmos Semiconductor Q3 sales rise on strong demand
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)