NeoPhotonics (NPTN) Tops Q2 EPS by 4c, Revenues Beat; Offers 3Q Revenue Mid-Point Guidance Above Consensus, Provides 3Q EPS Outlook

NeoPhotonics (NYSE: NPTN) reported Q2 EPS of $0.16, $0.04 better than the analyst estimate of $0.12. Revenue for the quarter came in at $103.2 million versus the consensus estimate of $99.5 million.

Second Quarter Summary

• Revenue was $103.2 million, up 6% quarter-over-quarter and up 26% year-over-year
• Gross margin was 32.5%, up from 30.5% in the prior quarter and from 19.2% in the prior year
• Non-GAAP gross margin was 33.2%, up from 31.2% in the prior quarter and up from 25.6% in the prior year
• Diluted net income per share was $0.11, in comparison to $0.12 in the prior quarter and to a net loss per share of $0.16 in the same period last year
• Non-GAAP diluted net income per share was $0.16, in comparison to $0.17 in the prior quarter and to a net loss of $0.03 in the same period last year
• Cash generated from operations was $9.6 million, down from $24.9 million in the prior quarter and up from $0.7 million in the same period last year
• Adjusted EBITDA was $16.9 million, in comparison to $17.8 million in the prior quarter and to $6.8 million in the same period last year.

“The second quarter was another strong quarter, with revenue up 26% compared to last year and continued gross margin expansion to 32.5%. This was our fourth straight quarter of profitability. Non-GAAP EPS was 16 cents and GAAP EPS was 11 cents per share,” said Tim Jenks, Chairman and CEO of NeoPhotonics. “With increasing momentum in 400G and above product design wins across almost all of the major network equipment manufacturers globally, and with increasing momentum in 400ZR opportunities, we remain optimistic about the growth prospects for NeoPhotonics,” concluded Mr. Jenks.

GUIDANCE:

NeoPhotonics sees Q3 2020 EPS of $0.03-$0.13, versus the consensus of $0.11. NeoPhotonics sees Q3 2020 revenue of $97-105 million, versus the consensus of $98.31 million.

• The third quarter EPS outlook includes an expected $1.0 million unfavorable impact for foreign exchange.
• The non-GAAP outlook for the third quarter of 2020 excludes the expected impact of stock-based compensation expense of approximately $3.4 million, of which $0.7 million is estimated for cost of goods sold, and the impact of expected amortization of acquisition-related intangibles and other costs of approximately $0.3 million.

For earnings history and earnings-related data on NeoPhotonics (NPTN) click here.

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