CommScope (NASDAQ: COMM) reported Q1 EPS of $0.12, $0.05 better than the analyst estimate of $0.07. Revenue for the quarter came in at $2.03 billion versus the consensus estimate of $1.99 billion.

Highlights

• Net sales of $2.03 billion
• GAAP net loss of $159.9 million
• Non-GAAP adjusted EBITDA of $231.2 million
• Redeemed $100 million aggregate principal amount of 5% senior notes due 2021
• Debt reduced by over $600 million since ARRIS acquisition close

“In this period of uncertainty in our global operating environment, we are focused first and foremost on the health and wellbeing of our employees, their families and the communities in which we operate. Protecting these resources is of the utmost importance to CommScope, and we are taking significant actions to ensure everyone’s safety,” said President and Chief Executive Officer Eddie Edwards.

“I am incredibly proud of our team and how resilient our business model is. We quickly mobilized across the company to respond to the COVID-19 pandemic; supporting the phenomenal and sudden increase in demand for broadband and connectivity by everyone: our emergency services, businesses, remote workers and everyone sheltering-in-place at home. On behalf of the Board and management team, I thank our employees for their fortitude, creativity, innovation, positive spirit and resilience in providing essential services.”

Edwards continued, “We saw strong performance in the first quarter with net sales, non-GAAP adjusted EBITDA and adjusted EPS consistent with our expectations. Despite the significant supply headwinds resulting from COVID-19, we remain well-positioned to support network operators globally, delivering our innovative products that are the backbone to critical communications infrastructure. The Board and leadership team are confident CommScope will successfully navigate through this challenging operating environment and emerge a stronger company.”

Outlook

Due to the evolving and significant uncertainties related to the impact of the COVID-19 pandemic, CommScope is withdrawing its full-year 2020 outlook.

While the Company is not providing specific guidance for the second quarter, the Company expects its second quarter sales and non-GAAP adjusted EBITDA to improve modestly compared to the first quarter.

“Given the dynamic nature and unprecedented situation, we are taking decisive actions to strengthen our financial position and prudently manage our balance sheet. These actions include adjusting our operating plan to reduce costs and capital expenditures and drawing $250 million on our ABL revolving credit facility as a precautionary measure to preserve financial flexibility,” said Alex Pease, Executive Vice President and Chief Financial Officer. “While our business to date has proven to be remarkably resilient and we have seen extremely strong order rates across certain critical segments, we are acutely aware of the strains on the global economy and the impact that could have on many of our customers, particularly in the enterprise space. Due to this ongoing market uncertainty created by the COVID-19 pandemic, we are not providing specific guidance for the second quarter of 2020 and we are withdrawing our full year outlook. However, we do expect our second quarter sales and non-GAAP adjusted EBITDA to improve modestly compared to the first quarter.”

Pease continued, “We are monitoring the situation closely and remain in close contact with our business partners and customers. Never has it been more apparent how critical our products are to support the networks of the future, enabling remote working, and keeping people around the world connected. We continue to enable and deliver the broadband connectivity that is essential to a wide array of the functions crucial to our digital society and are committed to creating long-term value for shareholders.”

For earnings history and earnings-related data on CommScope (COMM) click here.