HARMONIC INC. FIRST QUARTER 2024
EARNINGS CONFERENCE CALL
Patrick Harshman, President & CEO
Nimrod Ben-Natan, SVP Broadband Walter Jankovic, CFO
April 29, 2024
©2024 Harmonic Inc. All rights reserved worldwide.
FORWARD-LOOKINGSTATEMENTS
During the course of this presentation, we will provide projections and other forward-looking statements regarding future events or the future financial performance of Harmonic, including expectations concerning our business strategy for 2024 and beyond, and our Q2 and full-year 2024 guidance. Such statements are only current expectations and actual events or results may differ materially. We refer you to Harmonic's filings with the SEC, particularly our most recent Reports on Form 10-K, Form 10-Q and Form 8-K. These documents identify important risk factors that could cause actual results to differ materially from our projections or other forward-looking statements. We will also present financial metrics determined on a "non- GAAP" basis. These items, together with the corresponding GAAP numbers and a reconciliation to GAAP, are contained in this presentation and the related earnings press release on our website at www.harmonicinc.com.
©2024 Harmonic Inc. All rights reserved worldwide. | 2 |
Q1 2024 HIGHLIGHTS
Broadband strategy remains on track for multiyear growth
Video SaaS revenue growth driven by new sports opportunities and ad delivery technology
Redeemed $115.5M 2024 Convertible Notes in April 2024
©2024 Harmonic Inc. All rights reserved worldwide. | 3 |
BROADBAND SEGMENT UPDATE
Q1 HIGHLIGHTS
- Revenue $78.9 million, down from $100.4 million prior year
- Commercially deployed with 113 operators, up 20% year over year
- 28.6 million cable modems served, ~16% of global market
EXECUTING MULTIYEAR GROWTH PLAN
- DOCSIS 4.0 leadership with accelerating shipments
- Diversifying broadband revenue base beyond largest two customers
- Beacon Intelligent Speed Maximizer subscription-based feature for cOSTM
- MFiber-to-the-homeinitiatives gaining traction with recent wins
©2024 Harmonic Inc. All rights reserved worldwide. | 4 |
VIDEO SEGMENT UPDATE
Q1 HIGHLIGHTS
- SaaS revenue $12.9 million, up 11% year over year
- Total Video revenue $43.2 million, down from $57.3 million prior year
- Macro-economicheadwinds and Video Review impacted revenue
STRATEGIC EXECUTION AND PRIORITIES
- New in-stream targeted advertising SaaS for live sports streaming
- Strong pipeline of tier 1 SaaS opportunities
- Streamlining business and increasing full year EBITDA outlook
©2024 Harmonic Inc. All rights reserved worldwide. | 5 |
FINANCIAL RESULTS AND OUTLOOK
Walter Jankovic, CFO
6
Q1 2024 FINANCIAL HIGHLIGHTS*
FINANCIAL RESULTS
- Revenue $122.1 million, down 22.6% year over year
- EPS $0.00, compared to $0.12 in Q1 2023
- Bookings $146.1 million, book to bill ratio of 1.2
- Record Backlog and Deferred Revenue $677.8 million, up 8.7% year over year
GUIDANCE FOR KEY FINANCIAL METRICS
- Reaffirming our Broadband FY24 revenue guidance of $460M to $500M
- Broadband growth in FY25 expected to accelerate further
- Video FY24 EBITDA guidance increased due to restructuring actions
* Non-GAAP
©2024 Harmonic Inc. All rights reserved worldwide. | 7 |
Q1 2024 REVENUE & GROSS MARGIN HIGHLIGHTS*
Financial Metric | Q1 | Q4 | Q1 | Q1/Q4 | Q1 Y/Y | ||
($ Millions) | 2024 | 2023 | 2023 | Change | Change | ||
Total Net Revenue | $122.1 | $167.1 | $157.6 | (27.0)% | (22.6)% | ||
Broadband Revenue | $78.9 | $115.2 | $100.4 | (31.5)% | (21.4)% | ||
Video Revenue | $43.2 | $51.9 | $57.3 | (16.8)% | (24.7)% | ||
Gross Margin (%) | 52.5% | 49.3% | 53.9% | 3.2% | (1.4)% | ||
Broadband Gross Margin (%) | 47.5% | 42.4% | 50.1% | 5.1% | (2.6)% | ||
Video Gross Margin (%) | 61.6% | 64.6% | 60.4% | (3.0)% | 1.2% | ||
* Non-GAAP. Components may not sum to total due to rounding
©2024 Harmonic Inc. All rights reserved worldwide. | 8 |
Q1 2024 EARNINGS AND BOOKINGS HIGHLIGHTS*
Financial Metric | Q1 | Q4 | Q1 | Q1/Q4 | Q1 Y/Y | |||
$ Millions (except EPS) | 2024 | 2023 | 2023 | Change | Change | |||
Operating Expenses | $62.8 | $63.4 | $66.2 | $(0.6) | $(3.4) | |||
Adj. EBITDA | $4.1 | $21.7 | $21.4 | $(17.6) | $(17.3) | |||
Broadband Adj. EBITDA | $10.4 | $21.9 | $21.6 | $(11.5) | $(11.2) | |||
Video Adj. EBITDA | $(6.4) | $(0.2) | $(0.2) | $(6.2) | $(6.2) | |||
EPS | $0.00 | $0.13 | $0.12 | $(0.13) | $(0.12) | |||
Share Count | 118.1 | 115.7 | 117.8 | 2.4 | 0.3 | |||
Bookings | $146.1 | $196.5 | $325.5 | $(50.4) | $(179.4) | |||
Book to Bill Ratio | 1.2 | 1.2 | 2.1 | - | (0.9) | |||
* Non-GAAP. Components may not sum to total due to rounding | ||||||||
©2024 Harmonic Inc. All rights reserved worldwide. | 9 |
Q1 2024 BALANCE SHEET & CASH FLOW HIGHLIGHTS
Financial Metric | Q1 | Q4 | Q1 | |
($ Millions) | 2024 | 2023 | 2023 | |
Cash | $84.3 | $84.3 | $90.9 | |
Cash Provided by Operations | $26.8 | $6.3 | $6.3 | |
Accounts Receivable | $105.9 | $141.5 | $88.1 | |
DSO | 78 | 76 | 50 | |
Inventory | $86.6 | $84.0 | $131.6 | |
Inventory Days | 134 | 89 | 163 | |
Backlog and Deferred Revenue | $677.8 | $653.2 | $623.5 | |
Free cash flow | $24.9 | $3.5 | $3.9 | |
©2024 Harmonic Inc. All rights reserved worldwide. | 10 |
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Harmonic Inc. published this content on 29 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 April 2024 20:48:00 UTC.
