HICKORY – CommScope Holding Co. (COMM) on Thursday reported financials that were a split in terms of expectations. But the communications gear provider’s CEO sees progress.
CommScore reported first-quarter net income of $3.4 million.
The Hickory-based company said it had net income of 6 cents per share. Earnings, adjusted for one-time gains and costs, were 35 cents per share.
The results beat Wall Street expectations. The average estimate of eight analysts surveyed by Zacks Investment Research was for earnings of 34 cents per share.
However, the wireless and broadband network technology company posted revenue of $2 billion in the period, falling short of Street forecasts. Seven analysts surveyed by Zacks expected $2.15 billion.
“CommScope delivered Core net sales of $1.66 billion and Core adjusted EBITDA of $315 million for the first quarter of 2023. This represents a 37% improvement in Core adjusted EBITDA over the first quarter of 2022 as our CommScope NEXT initiative continues to support improving EBITDA margins., said CEO Chuck Treadway.
CommScope says NEXT, is “designed to drive shareholder value through three pillars: profitable growth, operational efficiency and portfolio
optimization. ” It launched in 2021.
“CommScope believes these efforts are critical to making the Company more competitive and allowing it to invest in growth, de-lever and maximize stockholder and other stakeholder value in the future,” the company says.
‘Aggressively manage … components of our business that we control’
“I’m pleased with our team’s performance as we continue to aggressively manage the components of our business that we control,” Treadway explained. “CommScope NEXT is paying dividends with strong focus on the most important initiatives. A great example of this progress is in our NICS [network interface cards] segment where the team delivered $58 million of EBITDA in Q1, a $72 million improvement year-over-year.
“Current order input remains low as customers deal with high inventory levels and project delays as they manage through the uncertain economic environment. However, market feedback indicates a strong recovery in the second half as fiber deployment, infrastructure upgrades and continued need for more bandwidth drive strong market fundamentals. We are well positioned to take advantage of the growing market, as we announced more capacity additions in our fiber business during the first quarter. Based on current demand visibility driven by customer signaling a strong second half order rate, we maintain our expectation that we will deliver Core adjusted EBITDA in the $1.35 to $1.5 billion range.”
