NASDAQ$AVNW

Aviat Networks Inc · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Aviat Networks' financial results were negatively impacted by a cyberattack at a contract manufacturing vendor and international revenue decline, but North America revenue remained relatively stable.

Aviat Networks reported a decrease in total revenues for Q2 2020, primarily due to a cyberattack that constrained capacity and a decline in international revenue. North America revenue saw a slight decrease, while international revenue was significantly impacted by the spending environment in Africa and lower order volumes in the APAC region. The company reported a GAAP operating loss and a non-GAAP operating loss for the quarter.

  • Total revenues decreased by 14% compared to the same period last year, totaling $56.0 million.
  • North America revenue declined slightly by 2.3% to $36.5 million, but bookings increased.
  • International revenue decreased significantly by 29.7% to $19.5 million due to challenges in Africa and APAC.
  • The company reported a GAAP operating loss of $(1.5) million and a non-GAAP operating loss of $(0.7) million.

Headline financials

Total Revenue

$56M

Previous: $65.1M-14.0%
EPS (adj)

-$0.09

Previous: $0.27-133.3%
GAAP Gross Margin

32.7%

No prior period
Non-GAAP Gross Margin

32.8%

No prior period
Adjusted EBITDA

$362K

Previous: $4.48M-91.9%
Capital Expenditures

-$2.42M

Previous: -$3.24M+25.3%
Free Cash Flow

-$4.09M

Previous: -$926K-341.5%
Net Income

-$1.67M

Previous: $2.31M-172.3%
Operating Income

-$1.5M

Previous: $2.88M-151.9%
Gross Profit

$18.3M

Previous: $22.5M-18.5%
Cash & Equivalents

$38.1M

Previous: $31.5M+20.7%
Total Assets

$180M

Previous: $161M+11.6%
Stock-Based Comp

$401K

Previous: $502K-20.1%

Revenue & EPS history

Aviat · Revenue · Quarterly

$56M

Q2 2020-14%vs Q2 2019
Beat estimate in 5 of 5 quarters(100%)
ActualEstimate

Revenue by segment

Aviat · $56M total across 2 segments · Q2 2020

  • Product sales
    $34.2M
  • Services
    $21.8M

Forward guidance

Aviat Networks anticipates a modest decline in revenue for the full fiscal year, but expects stronger gross margins, an increase in profitability, and ongoing improvements in its cash position and balance sheet. They believe they are in position to deliver $11 million to $12 million of Adjusted EBITDA.

Tailwinds

  • Anticipates an increase in orders in the second half of the year based on conversations with customers and a strong start to the fiscal 2020 third quarter.
  • New 5G-related business that has been awarded should favorably impact results towards the end of fiscal 2020 and in the years that follow.
  • Expects stronger gross margins.
  • Expects an increase in profitability.
  • Anticipates ongoing improvements in cash position and balance sheet.

Headwinds

  • Anticipates a modest decline in revenue for the full fiscal year.
  • Fiscal 2020 second quarter results were adversely impacted by a cyberattack.
  • Revenue was impacted by the spending environment in Africa.
  • APAC region drove international revenue down year-over-year.
  • Capacity constraints caused by a cyberattack at one of the Company’s contract manufacturers had a direct impact on non-GAAP operating income and Adjusted EBITDA

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+0.7%

Avg return

Earnings day

+3.5%

Avg return

5 days after

+5.7%

Avg return

30 days after

55%

35 / 64 earnings

Positive

+28.2%

Q2 2025

Best reaction

-31.9%

Q1 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q3 2026-28.5%-30.0%-14.3%
Q2 2026+14.3%+16.7%+11.2%
Q1 2026+0.4%-3.2%-13.2%
Q4 2025+12.6%+3.6%-7.3%
Q3 2025+5.0%+4.0%+12.2%
Q2 2025+28.2%+12.7%-1.7%
Q1 2025-31.9%-28.5%-15.1%
Q3 2024-15.1%-6.4%-7.6%
Q2 2024+19.9%+9.3%+19.4%
Q1 2024+14.6%+14.5%+17.4%
Q4 2023+19.0%+21.1%+16.6%
Q3 2023-11.9%-16.3%-3.2%
Q2 2023+21.5%+13.0%+14.6%
Q1 2023-12.1%-10.5%+0.6%
Q4 2022+1.3%+1.0%-7.7%
Q3 2022-3.5%-9.1%-6.7%
Q2 2022+1.2%-2.6%-9.1%
Q1 2022+4.8%+4.7%-4.1%
Q4 2021-14.4%-9.4%-13.9%
Q3 2021-13.5%-9.2%+13.4%
Q2 2021+4.8%+25.1%+22.7%
Q1 2021+16.0%+27.6%+86.8%
Q4 2020+3.3%+10.3%+3.4%
Q3 2020+27.7%+28.8%+41.9%
Q2 2020+1.6%-1.3%-12.9%
Q1 2020+0.6%+2.5%+4.1%
Q4 2019+6.1%-0.8%+9.7%
Q3 2019-0.7%-1.5%-1.9%
Q2 2019+4.3%-1.6%-8.0%
Q1 2019-1.2%-4.5%-7.8%
Q4 2018+14.1%+11.9%+2.2%
Q3 2018+8.0%+10.0%-0.2%
Q2 2018+2.5%+5.1%+12.7%
Q1 2018+18.2%+16.6%+14.0%
Q4 2017+9.4%+7.7%+5.2%
Q3 2017-18.3%-11.9%-28.4%
Q2 2017+14.2%+18.5%+23.6%
Q1 2017+19.9%+29.6%+55.3%
Q4 2016-8.7%-10.2%-0.3%
Q3 2016-5.9%
Q2 2016-14.1%
Q1 2016-1.0%
Q4 2015+2.9%
Q3 2015-1.7%
Q2 2015-9.9%
Q1 2015+2.9%
Q4 2014-8.3%
Q3 2014-29.2%
Q2 2014+6.9%
Q1 2014-4.6%
Q4 2013-10.2%
Q3 2013-19.7%
Q2 2013+3.9%
Q1 2013-3.0%
Q4 2012+1.3%
Q3 2012-1.4%
Q2 2012-0.8%
Q1 2012-3.2%
Q4 2011+6.4%
Q3 2011-4.3%
Q2 2010-0.5%
Q1 2010+3.6%
Q4 2010-0.3%
Q3 2010+2.4%

Discussion

Share your read of this quarter. Sign-in carries your eToro identity.

Join the conversation

Sign in with eToro to post your read of this quarter and vote on others'.

Sign in with eToro