Q3 2024 Ribbon Communications Inc Earnings Call Transcript
Key Points
- Ribbon Communications Inc (RBBN) reported a 3.5% year-over-year increase in overall sales for the third quarter, with a 9% increase quarter-over-quarter, driven by growth in the cloud and edge business.
- The company achieved a non-GAAP gross margin of 55%, exceeding expectations and reaching the high end of guidance.
- Sales in the federal and defense industry grew by 60% year-to-date compared to 2023, accounting for 13% of overall sales.
- The cloud and edge business saw a significant increase, with revenue up 11% year-over-year and 16% quarter-over-quarter, and a non-GAAP gross margin near an all-time high at 68%.
- Ribbon Communications Inc (RBBN) has a strong pipeline of opportunities, particularly in the US, with a book-to-bill ratio of over 1.4 times, indicating strong demand and future growth potential.
- IP optical network sales were lower year-over-year due to the suspension of product sales to Eastern Europe.
- Cash from operations was negative $15 million for the quarter, with cash and cash equivalents ending at $40 million, lower than anticipated.
- Non-GAAP adjusted EBITDA for the IP optical segment was negative $8 million, down $4 million from the prior year.
- Interest expense in the quarter was $10 million, reflecting the new credit facility, which impacts profitability.
- The company faced delays in accounts receivable collections, which were expected at the end of September but were delayed into October, affecting cash flow.
Ladies and gentlemen, greetings and welcome to the Ribbon Communications third quarter 2024 financial results conference call.(Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, JJoni Roberts, Chief Marketing Officer. Please go ahead.
Good afternoon and welcome to Ribbon's third quarter, 2024 financial results conference call. I'm Joni Roberts, Chief Marketing Officer at Ribbon Communications. Also on the call today, Bruce McClelland, Ribbon's Chief Executive Officer; and John Townsend, who will shortly assume the role of Ribbon's Chief Financial Officer.
Today's call is being webcast live and will be archived on the investors relations section of our website ribboncommunications.com where both our press release and supplemental slides are currently available. Certain matters we will be discussing today including the business outlook and financial projections for fourth quarter of 2024
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