II-VI, Inc. (IIVI) Reports In-Line Q2 EPS, Revenues Beat; Offers Q3 EPS/Revenue Guidance Below Consensus

II-VI, Inc. (NASDAQ: IIVI) reported Q2 EPS of $0.36, in-line with the analyst estimate of $0.36. Revenue for the quarter came in at $666.3 million versus the consensus estimate of $610.28 million.

First Complete Fiscal Quarter with FinisarRevenue Exceeded Top End of Guidance

• Quarterly Revenue of $666.3 million, Exceeded Top End of our Guidance by 6% and the Analysts’ Consensus by 9%, with Strength Across Most Markets
• Quarterly GAAP Operating Loss Includes $91 million of One Time Transaction Expenses
• Quarterly Adjusted Operating Income Increased 28% Sequentially
• Continuing Progress on Integration and Cost Synergy Strategies

“The just-completed quarter marks the first full quarter of II-VI operations with Finisar included, since the transaction closed on September 24, 2019. Revenue of $666.3M exceeded the top end of our guidance by 6% and the analysts’ consensus by 9%. This is driven by strength across our markets including optical communications, where stronger transceiver and ROADM sales exceeded our expectations, and sequential strength in 3D sensing, aerospace and defense and SiC substrates,” said Dr. Vincent D. Mattera, Jr. Chief Executive Officer of II-VI Incorporated. “We achieved record VCSEL product revenues and are completing our Sherman, Texas facility qualification. Across our markets, customer enthusiasm and support remain very high. We continue to make great progress on our integration and cost synergies, and look forward to addressing the market opportunities ahead."

GUIDANCE:

II-VI, Inc. sees Q3 2020 EPS of $0.02-$0.32, versus the consensus of $0.39. II-VI, Inc. sees Q3 2020 revenue of $550-600 million, versus the consensus of $616.19 million.

The outlook for the third fiscal quarter ending March 31, 2020 is revenue of $550 million to $600 million and earnings per diluted share on a non-GAAP basis of $0.02 to $0.32. This range includes an estimated minimum reduction of revenue of $50 million for the coronavirus. This is at today’s exchange rate and today’s estimated tax rate of 10%. The non-GAAP earnings per share includes the pre-tax amounts of $16 million in stock compensation, $34 million in amortization, and $13 million in costs to facilitate the integration. Non-GAAP adjustments are by their nature highly volatile and we have low visibility as to the range that may be incurred in the future.

For earnings history and earnings-related data on II-VI, Inc. (IIVI) click here.

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