Calamp Corp. (CAMP) Updated Q3 Guidance Misses Views

CalAmp (Nasdaq: CAMP), a technology solutions pioneer leading transformation in a global connected economy, today updated its financial outlook for the fiscal 2019 third quarter ended November 30, 2018.

When the Company provided the financial outlook for the third quarter of fiscal 2019 on September 27, 2018, management discussed an accelerated supply chain diversification program to transition its manufacturing to tier one global contract manufacturers with facilities outside of China. This program was initiated against the backdrop of the escalation of trade tensions between the U.S. and China. During the third quarter, CalAmp experienced various supply disruptions related to this transition, as well as extended lead times driven by component shortages. This resulted in inbound product supply delays at quarter end and impacted the Company's ability to ship certain products to meet customer demand. Management is taking steps to address these operational challenges. These supply chain challenges, coupled with macroeconomic factors, have heightened near term uncertainty and highlight the importance of efforts to increase software-as-a-solution (SaaS) revenue.

"While we are disappointed in the short-term execution of our supply chain diversification efforts, we recognize that improving our supply chain partner program is critical for us to achieve greater flexibility and geographic diversity with our suppliers. We have undertaken various actions to improve our supply chain operations in order to avoid delays in the timing of future product shipments," said Michael Burdiek, President and Chief Executive Officer. "Overall, the Company's long-term growth drivers and market opportunities, especially those related to CalAmp's transformation to a SaaS solutions provider, remain intact. CalAmp's Software and Subscription business continues to perform well, and we are keenly focused on driving recurring revenue growth and increasing long-term visibility."

(Street sees Q3 EPS of $0.32)

Conference Call and Webcast Additionally, we are hosting a conference call for analysts and investors to discuss our fiscal 2019 third quarter results and outlook for our fourth quarter at 1:30 p.m. Pacific Time on December 20, 2018. Participants can listen in via webcast by visiting the Investor Relations section of our website at www.calamp.com. Please go to the website at least 15 minutes early to register, download and install any necessary audio software. A replay of the webcast will be available for 30 days after the call. The conference call can also be accessed by dialing 855-302-8830 (+1-330-871-6073 for international callers) and using the Conference ID# 6069225. Following the call, an audio replay will also be available by calling 855-859-2056 or +1-404-537-3406 and entering the Conference ID# 6069225. The audio replay will be available through January 3, 2019.

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