CRNT Ceragon Networks Ltd

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

This Form 6-K, including all exhibits hereto, is hereby incorporated by reference into all effective registration statements filed by the registrant under the Securities Act of 1933.

Ceragon Reports 17.7% Increase in Quarterly Revenue, GAAP

EPS of $0.14 Per Share in the Third Quarter

Revenue Diversification, Expense Management, Enable Consistent Profitability;

Management Reiterates Midpoint of Full-Year 2024 Outlook

 

 

Q3 2024 Financial Highlights:

 

Q3 2024 Business Highlights:

Revenues were $102.7 million, up 17.7% from $87.3 million in Q3 2023 and up 6.9% from $96.1 million in Q2 2024.

 

GAAP Operating income was $14.6 million compared with $6.7 million for Q3 2023 and $10.4 million for Q2 2024.

 

GAAP Net income was $12.2 million, or $0.14 per diluted share, compared with $3.4 million, or $0.04 per diluted share for Q3 2023 and $7.8 million, or $0.09 per diluted share for Q2 2024.

 

Non-GAAP results were as follows: Gross margin was 34.3%, operating income was $15.8 million, and net income of $14.1 million, or $0.16 per diluted share. The third quarter included approximately $5.1 million benefit related to collection from a debt settlement agreement reached with a South American customer.

 

Cash and cash equivalents were $34.0 million on September 30, 2024, compared to $26.3 million on June 30, 2024.

 

For a reconciliation of GAAP to non-GAAP results, see the attached tables.

Revenue Breakout by Geography:

Management reiterated its 2024 outlook, narrowing the expected range while maintaining the midpoint of the outlook:

The Company will host a Zoom web conference today at 8:30 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. Recent geopolitical events could impact the live question and answer session. In this unlikely event, management’s prepared remarks will be pre-recorded, and the question and answer session would be rescheduled.

If you are unable to join the live call, a replay will be available on our website at www.ceragon.com within 24 hours after the call. 

About Ceragon

 

Ceragon (NASDAQ: CRNT) is the global innovator and leading solutions provider of end-to-end wireless connectivity, specializing in transport, access, and AI-powered managed & professional services. Through our commitment to excellence, we empower customers to elevate operational efficiency and enrich the quality of experience for their end users.

 

Our customers include service providers, utilities, public safety organizations, government agencies, energy companies, and more, who rely on our wireless expertise and cutting-edge solutions for 5G & 4G broadband wireless connectivity, mission-critical services, and an array of applications that harness our ultra-high reliability and speed. Ceragon solutions are deployed by more than 600 service providers, as well as more than 1,600 private network owners, in more than 130 countries.

 

Through our innovative, end-to-end solutions, covering hardware, software, and managed & professional services, we enable our customers to embrace the future of wireless technology with confidence, shaping the next generation of connectivity and service delivery. Ceragon delivers extremely reliable, fast to deploy, high-capacity wireless solutions for a wide range of communication network use cases, optimized to lower TCO through minimal use of spectrum, power, real estate, and labor resources - driving simple, quick, and cost-effective network modernization and positioning Ceragon as a leading solutions provider for the “connectivity everywhere” era.

 

For more information please visit: www.ceragon.com

 

Ceragon Networks® and FibeAir® are registered trademarks of Ceragon Networks Ltd. in the United States and other countries. CERAGON® is a trademark of Ceragon Networks Ltd., registered in various countries. Other names mentioned are owned by their respective holders.

 

Safe Harbor

This press release contains statements that constitute “forward-looking statements” within the meaning of the Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended, and the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs, expectations and assumptions of Ceragon’s management about Ceragon’s business, financial condition, results of operations, micro and macro market trends and other issues addressed or reflected therein. Examples of forward-looking statements include, but are not limited to, statements regarding: projections of demand, revenues, net income, gross margin, capital expenditures and liquidity, competitive pressures, order timing, supply chain and shipping, components availability, growth prospects, product development, financial resources, cost savings and other financial and market matters. You may identify these and other forward-looking statements by the use of words such as “may”, “plans”, “anticipates”, “believes”, “estimates”, “targets”, “expects”, “intends”, “potential” or the negative of such terms, or other comparable terminology, although not all forward-looking statements contain these identifying words.

 

Although we believe that the projections reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be obtained or that any deviations therefrom will not be material. Such forward-looking statements involve known and unknown risks and uncertainties that may cause Ceragon’s future results or performance to differ materially from those anticipated, expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: the effects of the evolving nature of the war situation in Israel and the related evolving regional conflicts; the effects of global economic trends, including recession, rising inflation, rising interest rates, commodity price increases and fluctuations, commodity shortages and exposure to economic slowdown; risks associated with delays in the transition to 5G technologies and in the 5G rollout; risks relating to the concentration of our business on a limited number of large mobile operators and the fact that the significant weight of their ordering, compared to the overall ordering by other customers, coupled with inconsistent ordering patterns, could negatively affect us; risks resulting from the volatility in our revenues, margins and working capital needs; disagreements with tax authorities regarding tax positions that we have taken could result in increased tax liabilities; the high volatility in the supply needs of our customers, which from time to time lead to delivery issues and may lead to us being unable to timely fulfil our customer commitments; and such other risks, uncertainties and other factors that could affect our results of operation, as further detailed in Ceragon’s most recent Annual Report on Form 20-F, as published on March 21, 2024, as well as other documents that may be subsequently filed by Ceragon from time to time with the Securities and Exchange Commission.

 

We caution you not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Ceragon does not assume any obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release unless required by law.

 

While we believe that we have a reasonable basis for each forward-looking statement contained in this press release, we caution you that these statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. In addition, any forward-looking statements represent Ceragon’s views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. Ceragon does not assume any obligation to update any forward-looking statements unless required by law.

 

The results reported in this press-release are preliminary and unaudited results, and investors should be aware of possible discrepancies between these results and the audited results to be reported, due to various factors.

 

Ceragon’s public filings are available on the Securities and Exchange Commission’s website at www.sec.gov and may also be obtained from Ceragon’s website at www.ceragon.com.

 

Ceragon Investor & Media Contact:

 

Rob Fink

FNK IR

Tel. 1+646-809-4048

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except share and per share data)

(Unaudited)

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

(U.S. dollars, in thousands)

(Unaudited)

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

(U.S. dollars in thousands, except share and per share data)

(Unaudited)

		Three months ended September 30,								Nine months ended September 30,
		2024				2023				2024				2023
GAAP Operating income			14,631				6,672				29,208				17,041
Stock-based compensation expenses			907				1,048				3,377				3,028
Amortization of acquired intangible assets			306				-				1,072				-
Excess cost on acquired inventory in business combination (*)			-				-				124				-
Restructuring and other charges			-				-				1,416				897
Acquisition- and integration-related charges			-				283				1,377				283
Non-GAAP Operating income			15,844				8,003				36,574				21,249
GAAP Financial expenses and others, net			1,834				1,722				6,611				5,066
Leases – financial income (expenses)			(501	)			364				(182	)			1,007
Non-cash revaluation expenses associated with business combination			(122	)			-				(318	)			-
Non-GAAP Financial expenses and others, net			1,211				2,086				6,111				6,073
GAAP Tax expenses			580				1,583				2,144				4,552
Non-cash tax adjustments			-				(630	)			(413	)			(2,373	)
Non-GAAP Tax expenses			580				953				1,731				2,179
GAAP Net income			12,217				3,367				20,453				7,423
Stock-based compensation expenses			907				1,048				3,377				3,028
Amortization of acquired intangible assets			306				-				1,072				-
Excess cost on acquired inventory in business combination (*)			-				-				124				-
Restructuring and other charges			-				-				1,416				897
Acquisition- and integration-related charges			-				283				1,377				283
Leases – financial expenses (income)			501				(364	)			182				(1,007	)
Non-cash revaluation expenses associated with business combination			122				-				318				-
Non-cash tax adjustments			-				630				413				2,373
Non-GAAP Net income			14,053				4,964				28,732				12,997
GAAP Basic net income per share			0.14				0.04				0.24				0.09
GAAP Diluted net income per share			0.14				0.04				0.23				0.09
Non-GAAP Diluted net income per share (**)			0.16				0.06				0.33				0.15

(*) Consists of charges to cost of revenues for the difference between the fair value of acquired inventory in business combination, which was recorded at fair value, and the actual cost of this inventory, which impacts the Company’s gross profit.

(**) Weighted average number of shares used in computing diluted net income per share is the same as in GAAP

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