NASDAQ$EXTR
Extreme Networks Inc · Q2 2024 earnings
Q2 2024 earnings · · Investor relations
Briefing
Reported financial results in-line with previously revised second quarter outlook.
Extreme Networks reported a decrease in revenue by 6.9% year-over-year, totaling $296.4 million. Despite the revenue decline, the company improved gross margins and optimized operating expenses to maintain a healthy operating margin. SaaS ARR grew by 37% year-over-year, reaching $158.0 million. The company expects to emerge in the fourth quarter at a more normalized level of revenue and earnings.
- Revenue was $296.4 million, a decrease of 6.9% year-over-year.
- SaaS ARR reached $158.0 million, showing a 37.4% increase year-over-year.
- GAAP diluted EPS was $0.03, compared to $0.13 in the prior year quarter.
- Non-GAAP diluted EPS was $0.24, compared to $0.27 in the prior year quarter.
Headline financials
Revenue & EPS history
Extreme Networks · Revenue · Quarterly
$296M
Revenue by segment
Extreme Networks · $253M total across 1 segment · Q1 2024
- Product$253M+22.9%100.0%
Forward guidance
For the third quarter of fiscal 2024, Extreme Networks is targeting revenue between $200.0 and $210.0 million. They anticipate GAAP gross margin between 58.6% and 60.6%, and a GAAP operating margin between -33.7% and -29.2%. The company expects a GAAP earnings per share between $(0.55) and $(0.50). For the fourth quarter of fiscal 2024, Extreme Networks is targeting revenue between $265.0 and $275.0 million, with GAAP and non-GAAP gross margin to be flat to up slightly from Q3. The company projects a non-GAAP operating margin of 10% - 13% and a GAAP operating margin of (2)% - 1%.
Tailwinds
- Expecting improved sequential revenue growth based on funnel and the seasonality of business, led by the Education vertical in Q4.
- Positioned to deliver improved profitability and cash flow in FY25.
- GAAP and non-GAAP gross margin to be flat to up slightly from Q3 in Q4.
- Expecting stabilization across EMEA and growth in APAC.
- Remains focused on innovation with the introduction of new Wi-Fi 7 access points and 4000 Series Universal Switches.
Headwinds
- Networking industry is exiting the final stage of the COVID-induced era of supply chain constraints, impacting the business.
- Distributors and partners have lowered inventory purchases, which is expected to accelerate in the third quarter.
- Expect higher sell-through than sell-in, which will have a more significant impact on operating results in Q3.
- Plan to take cost actions to drive a recovery in EPS and cash flow.
- Targeting a GAAP operating margin between -33.7% and -29.2% for Q3.
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 2024
+0.2%
Avg return
Earnings day
-0.7%
Avg return
5 days after
+3.9%
Avg return
30 days after
61%
39 / 64 earnings
Positive
+28.2%
Q3 2026
Best reaction
-30.4%
Q4 2018
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q3 2026 | +28.2% | +33.9% | +55.5% | |
| Q2 2026 | +2.4% | -0.9% | -6.9% | |
| Q1 2026 | -15.4% | -11.7% | -17.7% | |
| Q3 2025 | +4.9% | +7.8% | +19.1% | |
| Q2 2025 | -3.0% | -6.3% | -4.9% | |
| Q1 2025 | +5.0% | +6.9% | +16.7% | |
| Q4 2024 | +3.6% | +2.7% | +5.8% | |
| Q3 2024 | +2.0% | -2.1% | -0.4% | |
| Q2 2024 | -20.6% | -25.9% | -25.1% | |
| Q1 2024 | -17.1% | -17.6% | -20.6% | |
| Q4 2023 | +6.6% | +9.6% | -2.5% | |
| Q3 2023 | +8.4% | +10.8% | +19.4% | |
| Q2 2023 | -9.0% | -9.4% | -2.4% | |
| Q1 2023 | +13.8% | +16.4% | +29.4% | |
| Q4 2022 | +17.4% | +16.7% | +28.6% | |
| Q3 2022 | -13.0% | -12.1% | -10.9% | |
| Q2 2022 | -1.9% | +1.5% | -2.5% | |
| Q1 2022 | +15.5% | +11.5% | +30.6% | |
| Q4 2021 | +14.7% | +13.5% | +12.6% | |
| Q3 2021 | +16.8% | +10.3% | +11.3% | |
| Q2 2021 | +1.7% | -3.6% | -6.6% | |
| Q1 2021 | -5.1% | -16.3% | +22.0% | |
| Q4 2020 | +4.6% | +1.3% | -14.5% | |
| Q3 2020 | -1.5% | -13.9% | +36.8% | |
| Q2 2020 | -15.8% | -19.3% | -30.7% | |
| Q1 2020 | -14.9% | -13.6% | -7.1% | |
| Q4 2019 | +13.7% | +10.2% | -9.2% | |
| Q3 2019 | -20.1% | -17.0% | -29.6% | |
| Q2 2019 | +9.0% | +7.7% | +21.1% | |
| Q1 2019 | +14.7% | +11.6% | +12.1% | |
| Q4 2018 | -30.4% | -29.1% | -33.1% | |
| Q3 2018 | -23.5% | -26.7% | -24.3% | |
| Q2 2018 | -13.5% | -21.8% | -8.1% | |
| Q1 2018 | +0.6% | -4.7% | +10.1% | |
| Q4 2017 | +20.4% | +23.8% | +30.7% | |
| Q3 2017 | +11.1% | +19.7% | +33.2% | |
| Q2 2017 | +0.0% | +0.9% | +11.2% | |
| Q1 2017 | +2.9% | +2.4% | +1.9% | |
| Q4 2016 | +0.8% | +4.2% | +1.3% | |
| Q3 2016 | +5.7% | — | — | |
| Q2 2016 | -29.6% | — | — | |
| Q1 2016 | +1.4% | — | — | |
| Q4 2015 | +21.5% | — | — | |
| Q3 2015 | -0.8% | — | — | |
| Q2 2015 | +12.6% | — | — | |
| Q1 2015 | +15.2% | — | — | |
| Q4 2014 | -0.8% | — | — | |
| Q3 2014 | -29.0% | — | — | |
| Q2 2014 | -16.3% | — | — | |
| Q1 2014 | +12.0% | — | — | |
| Q4 2013 | -4.8% | — | — | |
| Q3 2013 | -4.6% | — | — | |
| Q2 2013 | +0.8% | — | — | |
| Q1 2013 | +8.0% | — | — | |
| Q4 2012 | +0.3% | — | — | |
| Q3 2011 | -0.8% | — | — | |
| Q3 2012 | +0.3% | — | — | |
| Q2 2011 | +2.2% | — | — | |
| Q2 2012 | +0.9% | — | — | |
| Q1 2012 | +2.4% | — | — | |
| Q1 2011 | +2.4% | — | — | |
| Q4 2011 | +2.4% | — | — | |
| Q4 2010 | -2.3% | — | — | |
| Q3 2010 | +0.3% | — | — |
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