On August 8, 2024, Resideo Technologies Inc (REZI, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 29, 2024. Resideo Technologies Inc is a manufacturer and developer of technology-driven products and components that provide critical comfort, energy management, and safety and security solutions. The company operates through two segments: Products and Solutions, and ADI Global Distribution.
Performance Overview
Resideo Technologies Inc (REZI, Financial) reported net revenue of $1.59 billion for Q2 2024, slightly above the analyst estimate of $1.534 billion. However, the company’s earnings per share (EPS) of $0.19 fell short of the estimated $0.36. This represents a decline from the $0.34 EPS reported in the same quarter last year.
Segment Analysis
The Products and Solutions segment reported net revenue of $630 million, a 7% decrease compared to the same period last year. Despite the revenue decline, the segment achieved a gross margin of 41.3%, up from 38.3% in Q2 2023. This improvement was attributed to better material costs, lower direct labor spending, and favorable factory utilization.
In contrast, the ADI Global Distribution segment saw a 4% increase in net revenue, reaching $959 million. The segment's gross margin improved slightly to 19.4%, up from 19.2% in the previous year. However, income from operations decreased to $62 million from $71 million in Q2 2023, primarily due to increased selling, general, and administrative expenses.
Financial Achievements and Challenges
Resideo Technologies Inc (REZI, Financial) reported a net income of $30 million for Q2 2024, down from $50 million in the same quarter last year. Adjusted EBITDA was $175 million, up from $155 million in Q2 2023, indicating improved operational efficiency. The company also completed the acquisition of Snap One, which contributed $45 million to ADI's revenue.
"Our second quarter results demonstrated the substantial progress we have made in transforming the structural profitability profile of the business and in executing on value-creating strategic transactions," commented Jay Geldmacher, Resideo’s President and CEO.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Revenue | $1.59 billion | $1.60 billion |
| Net Income | $30 million | $50 million |
| Adjusted EBITDA | $175 million | $155 million |
| EPS | $0.19 | $0.34 |
Cash Flow and Liquidity
Net cash provided by operating activities was $92 million, down from $121 million in Q2 2023, primarily due to transaction costs related to the Snap One acquisition. As of June 29, 2024, the company had cash and cash equivalents of $413 million and total outstanding debt of $1.99 billion.
Outlook
For Q3 2024, Resideo Technologies Inc (REZI, Financial) expects net revenue between $1.79 billion and $1.83 billion, with non-GAAP adjusted EPS ranging from $0.49 to $0.59. For the full year 2024, the company projects net revenue between $6.68 billion and $6.76 billion, with non-GAAP adjusted EPS between $2.15 and $2.35.
Resideo Technologies Inc (REZI, Financial) continues to navigate a challenging market environment characterized by higher interest rates and low housing turnover. However, the company remains focused on strategic initiatives and operational efficiencies to drive long-term growth.
Explore the complete 8-K earnings release (here) from Resideo Technologies Inc for further details.
