Q2 2024 NETGEAR Inc Earnings Call Transcript
Key Points
- Successful channel destocking at the high end of the $25 million to $30 million target, improving business linearity.
- Inventory position reduced by $22 million, down 24% since the beginning of the year.
- Generated $16 million in free cash flow and executed $10 million in share repurchases.
- Record quarter of sell-through for Pro AV managed switch business, now back on a growth trajectory.
- Recurring subscription revenue grew over 30% year-over-year, with 958,000 subscribers.
- Revenue down 12.6% sequentially and 17% year-over-year, impacted by destocking and inventory reduction efforts.
- Non-GAAP gross margin decreased to 22.4%, down 920 basis points year-over-year.
- Non-GAAP operating loss of $31.1 million, with an operating margin of negative 21.6%.
- Higher cost of inventory and transportation costs due to the Red Sea shipping crisis.
- Service provider revenue expected to be lower in Q3, impacting overall revenue.
Ladies and gentlemen, thank you for standing by. (Operator Instructions) I would now like to turn the conference over to Erik Bylin. Please go ahead.
Thank you, operator. Good afternoon, and welcome to NETGEAR's second-Quarter of 2024 financial results conference call. Joining us the company are Mr. CJ Prober, CEO; and Mr. Bryan Murray, CFO.
The format of the call will start with commentary on the business provided by CJ, followed by a review of the financials for the second quarter and guidance for the third quarter provided by Bryan. We'll then have time for any questions. If you have not received a copy of today's release, please visit NETGEAR's Investor Relations website at www.netgear.com.
Before we begin the formal remarks, we advise you that today's conference call contains forward-looking statements. Forward-looking statements include statements regarding expected revenue, operating margins, tax expense, expenses and future business outlook.
| Access to All Earning Calls and Stock Analysis | |
| 30-Year Financial on one screen | |
| All-in-one Stock Screener with unlimited filters | |
| Customizable Stock Dashboard | |
| Real Time Insider Trading Transactions | |
| 8,000+ Institutional investors’ 13F holdings | |
| Powerful Excel Add-in and Google sheets Add-on | |
| All data downloadable | |
| Quick customer support | |
| And much more... |
Trustpilot
We'd love to learn more about your experiences on GuruFocus.com and how we can improve!
Take Survey
