[AudioCodes Second Quarter 2022 Results](index=1&type=section&id=AudioCodes%20Second%20Quarter%202022%20Results) [Second Quarter 2022 Financial and Operational Highlights](index=1&type=section&id=Second%20Quarter%202022%20Financial%20and%20Operational%20Highlights) AudioCodes reported **$68.4 million** in Q2 2022 revenues, up **12.9%** year-over-year, driven by strong service and enterprise segment growth Key Financial Highlights | Metric | Q2 2022 | YoY Change | | :--- | :--- | :--- | | Total Revenues | $68.4 million | +12.9% | | Service Revenues | $27.8 million | +21.9% | | GAAP Net Income | $6.9 million | -15.9% | | GAAP Diluted EPS | $0.21 | -12.5% | | Non-GAAP Net Income | $11.3 million | -11.0% | | Non-GAAP Diluted EPS | $0.34 | -8.1% | - The company experienced strong growth in its enterprise segment, with the **Microsoft business growing over 20%** and the **Zoom phone business growing over 50%** year-over-year[7](index=7&type=chunk) - AudioCodes Live for Microsoft Teams managed services continued its rapid expansion, reaching an **Annual Recurring Revenue (ARR) of $24 million**, representing **100% growth** over the same quarter last year, with **Total Contract Value (TCV) for Live projects now exceeding $60 million**[7](index=7&type=chunk) - The **Customer Experience (CX) business rebounded, growing by more than 20%** in the quarter, driven by the ongoing digital transformation of contact centers to the cloud[7](index=7&type=chunk) [Management Commentary](index=2&type=section&id=Management%20Commentary) Management highlighted strong Q2 execution in UCC and CX, prioritizing R&D and talent investment despite macro and supply chain issues - CEO Shabtai Adlersberg highlighted the company's **successful execution on key strategic priorities** and the **acceleration of its transition to software products and recurring subscription services**[5](index=5&type=chunk)[6](index=6&type=chunk) - The company is determined to **increase investments in R&D and customer-facing talent** to capitalize on new growth opportunities in its core markets[8](index=8&type=chunk) - Management believes that **ongoing supply chain disruptions are a short-term issue** that should be alleviated in the coming quarters[8](index=8&type=chunk) [Shareholder Returns](index=3&type=section&id=Shareholder%20Returns) AudioCodes returned capital to shareholders in Q2 2022 via **$8.3 million** in share repurchases and an **18 cents per share** cash dividend - During the second quarter, the company **repurchased 374,479 of its ordinary shares** at an aggregate cost of **$8.3 million**[1](index=1&type=chunk)[9](index=9&type=chunk) - In June 2022, the company received **court approval in Israel to purchase up to an additional $35 million of its ordinary shares or declare dividends**, valid through December 12, 2022[9](index=9&type=chunk) - The Board of Directors declared a **cash dividend of 18 cents per share**, payable on August 31, 2022, to shareholders of record on August 17, 2022[10](index=10&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$321.2 million** as of June 30, 2022, from **$349.4 million** at year-end 2021, mainly due to cash used for share repurchases and dividends Condensed Consolidated Balance Sheet Summary | Balance Sheet Item (in thousands) | June 30, 2022 (Unaudited) | December 31, 2021 (Audited) | | :--- | :--- | :--- | | Total current assets | $141,083 | $167,553 | | Total assets | $321,164 | $349,364 | | Total current liabilities | $95,631 | $95,943 | | Total liabilities | $138,351 | $143,866 | | Total shareholders' equity | $182,813 | $205,498 | - **Cash, cash equivalents, and various short and long-term deposits and securities totaled $138.5 million** as of June 30, 2022, **down from $174.8 million** as of December 31, 2021, mainly due to share repurchases and dividend payments[5](index=5&type=chunk) [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2022 total revenues increased **12.9%** to **$68.4 million**, but operating income and GAAP net income declined due to higher expenses Condensed Consolidated Statements of Operations Summary | Income Statement (in thousands, except EPS) | Q2 2022 (Unaudited) | Q2 2021 (Unaudited) | | :--- | :--- | :--- | | Total Revenues | $68,360 | $60,575 | | Gross Profit | $44,510 | $42,060 | | Operating Income | $7,922 | $10,132 | | Net Income | $6,936 | $8,240 | | Diluted Net Earnings Per Share | $0.21 | $0.24 | [Reconciliation of GAAP to Non-GAAP Net Income](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Net%20Income) Q2 2022 Non-GAAP net income was **$11.3 million** (**$0.34** diluted EPS), adjusted from GAAP for share-based compensation and other non-cash items GAAP to Non-GAAP Net Income Reconciliation | Metric (in thousands, except EPS) | Q2 2022 (Unaudited) | Q2 2021 (Unaudited) | | :--- | :--- | :--- | | GAAP Net Income | $6,936 | $8,240 | | Non-GAAP Net Income | $11,346 | $12,674 | | GAAP Diluted EPS | $0.21 | $0.24 | | Non-GAAP Diluted EPS | $0.34 | $0.37 | - Key adjustments from GAAP to Non-GAAP net income for Q2 2022 included: **Share-based compensation ($3.9 million)**, **amortization expenses ($0.2 million)**, and **deferred tax ($0.9 million)**[23](index=23&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Net cash from operating activities decreased to **$4.8 million** in Q2 2022, with **$8.1 million** used in financing, mainly for share repurchases Condensed Consolidated Statement of Cash Flows Summary | Cash Flow Activity (in thousands) | Q2 2022 (Unaudited) | Q2 2021 (Unaudited) | | :--- | :--- | :--- | | Net cash provided by operating activities | $4,818 | $17,058 | | Net cash provided by (used in) investing activities | $574 | $(1,814) | | Net cash used in financing activities | $(8,124) | $(7,071) | | Net increase (decrease) in cash | $(2,732) | $8,173 | - The primary use of cash in financing activities was the **purchase of treasury shares, amounting to $8.3 million** in Q2 2022[28](index=28&type=chunk)

Financial Data and Key Metrics Changes - Revenues for Q1 2022 were $66.4 million, an increase of 12.8% from $58.8 million in Q1 2021 [10] - Services revenues were $27.5 million, up 26.2% year-over-year, accounting for 41.5% of total revenues [10] - GAAP gross margin for the quarter was 66.9%, down from 68.4% in Q1 2021 [11] - Non-GAAP gross margin was 67.2%, compared to 68.7% in Q1 2021 [11] - Net income for Q1 2022 was $8.6 million or $0.26 per diluted share, compared to $10 million or $0.29 per diluted share in Q1 2021 [11] Business Line Data and Key Metrics Changes - The Enterprise business grew over 15% year-over-year, accounting for roughly 85% of total revenues [13] - Unified Communication and Collaboration (UCC) business grew over 20% year-over-year, with Microsoft business growing above 25% [14] - Customer Experience (CX) segment declined 8.5% year-over-year, primarily due to tough comparisons from the previous year [15] Market Data and Key Metrics Changes - Revenue by geographical region: North America 48%, EMEA 34%, Asia-Pacific 14%, Central and Latin America 4% [10] - The addressable market for voice services is expected to reach $72 billion by 2025 [22] Company Strategy and Development Direction - The company aims to be the most interoperable communications platform as a service (CPaaS) for voice services, focusing on the enterprise segment [22] - The strategy includes expanding the voice platform and upselling Conversational AI applications into UCC and CX verticals [25] - The company plans to accelerate its transition to subscription services via AudioCodes Live, expecting to double its managed services revenue in 2022 [16] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating supply chain issues and maintaining strong business fundamentals [19] - The company anticipates a stabilization of supply chain costs by the end of the year, with improvements in gross margins expected in the second half of 2022 [62][70] - Management remains optimistic about the growth opportunities in the UCC market and the strategic vision for the company [43] Other Important Information - The company acquired 720,000 ordinary shares for approximately $20.9 million during the quarter [12] - Deferred revenues as of March 31, 2022, were $76.8 million, up from $71.6 million a year earlier [10] Q&A Session Summary Question: What was the exact impact from Russia on the business in the quarter? - The impact was mainly in the CX market, where a large deal was deleted, leading to low revenues compared to Q1 2021 [46] Question: Can you talk about the attach rates for applications into the Microsoft ecosystem? - The company is focused on cross-selling additional services once they penetrate accounts with their core offerings [48] Question: Any specifics around how Callverso has been performing? - There has been significant growth in new opportunities for virtual agent solutions, particularly in the medical and financial sectors [56] Question: Was the decline in contact center customer experience primarily attributable to Russia? - The decline was due to several factors, including the Russian market, delayed opportunities in finance, and some players losing market share [58] Question: How should we think about the shape of margin throughout the rest of the year? - The company expects residual impacts from higher procurement costs in Q2 but anticipates stabilization by the end of the year [62] Question: How is Teams performing across different geographical regions? - Teams continues to grow, with significant increases in user adoption and opportunities created [64]

[First Quarter 2022 Overview](index=1&type=section&id=First%20Quarter%202022%20Overview) AudioCodes' Q1 2022 performance saw revenue growth driven by services, alongside decreased GAAP and Non-GAAP net income [First Quarter Highlights](index=1&type=section&id=First%20Quarter%20Highlights) AudioCodes reported **12.8% YoY revenue growth** to **$66.4 million**, driven by services, and **$11.2 million** non-GAAP net income Q1 2022 Financial Highlights | Metric | Q1 2022 (USD millions) | YoY Change (%) | | :---------------------- | :--------------------- | :------------- | | Revenues | 66.4 | 12.8% | | Service Revenues | 27.5 | 26.2% | | GAAP Gross Margin | 66.9% | - | | GAAP Operating Margin | 12.1% | - | | GAAP Net Income | 8.6 | - | | GAAP Diluted EPS | 0.26 | - | | Non-GAAP Gross Margin | 67.2% | - | | Non-GAAP Operating Margin | 18.0% | - | | Non-GAAP Net Income | 11.2 | - | | Non-GAAP Diluted EPS | 0.33 | - | | Net Cash from Operations | 0.938 | - | - AudioCodes declared a cash dividend of **18 cents per share**, totaling **$5.8 million**, paid on March 1, 2022 The company repurchased **720,124 ordinary shares** at an aggregate cost of **$20.9 million** during the quarter[2](index=2&type=chunk) [Detailed Financial Performance](index=2&type=section&id=Detailed%20Financial%20Performance) Revenues rose to **$66.4 million**, but GAAP and Non-GAAP net income declined YoY, with cash decreasing due to capital returns Q1 2022 vs Q1 2021 Revenue and Net Income | Metric | Q1 2022 (USD millions) | Q1 2021 (USD millions) | Change (USD millions) | Change (%) | | :---------------------- | :--------------------- | :--------------------- | :-------------------- | :--------- | | Revenues | 66.4 | 58.8 | 7.6 | 12.9% | | GAAP Net Income | 8.6 | 10.0 | (1.4) | (14.0%) | | GAAP Diluted EPS | 0.26 | 0.29 | (0.03) | (10.3%) | | Non-GAAP Net Income | 11.2 | 12.7 | (1.5) | (11.8%) | | Non-GAAP Diluted EPS | 0.33 | 0.37 | (0.04) | (10.8%) | Cash and Cash Equivalents | Metric | March 31, 2022 (USD millions) | December 31, 2021 (USD millions) | Change (USD millions) | | :---------------------------------------------------------------------------------------------------- | :---------------------------- | :------------------------------- | :-------------------- | | Cash and cash equivalents, long and short-term bank deposits, marketable securities, and financial investments | 144.1 | 174.8 | (30.7) | - The decrease in cash and cash equivalents was primarily a result of cash used for the share repurchase program and cash dividend payments during **Q1 2022**[5](index=5&type=chunk) [Business Segment Performance & Strategic Initiatives](index=2&type=section&id=Business%20Segment%20Performance%20%26%20Strategic%20Initiatives) UCC business, including Microsoft Teams Voice and Zoom Phone, drove growth; service revenues rose **25% YoY**, and conversational AI grew **40%** - UCC business was a key growth driver, with enterprise sales in Microsoft Teams Voice and Zoom Phone environments each growing **above 50% year-over-year** The Microsoft business as a whole grew **above 25% year-over-year**[6](index=6&type=chunk) - AudioCodes Live for Microsoft Teams managed services ARR is forecasted to **double in 2022** and reach a level of **above $30 million**[6](index=6&type=chunk) - Service revenues grew **above 25% year-over-year**, driven primarily by professional services and AudioCodes Live managed services, reaching **41.5% of total company revenue**[6](index=6&type=chunk) - In the CX market, **total contract value (TCV)** for conversational AI business grew **40% year-over-year**, with a forecast to grow **more than 50% in 2022**, supported by the Callverso acquisition and Voice.ai Connect platform[8](index=8&type=chunk) - **Q1 2022** non-GAAP operating margin was **18%**, **240 basis points** below last quarter's, mainly due to **$1.4 million** higher component costs affecting gross margins and a **17% increase in headcount** and related budget[9](index=9&type=chunk) [Shareholder Returns & Capital Management](index=3&type=section&id=Shareholder%20Returns%20%26%20Capital%20Management) Declared **18 cents per share cash dividend**, repurchased **$20.9 million** in shares, with **$8.3 million** remaining for capital returns Shareholder Returns Q1 2022 | Metric | Amount (USD) | | :---------------------- | :----------- | | Cash Dividend per Share | $0.18 | | Total Cash Dividend Paid | $5.8 million | | Shares Repurchased | 720,124 | | Cost of Repurchases | $20.9 million | - As of **March 31, 2022**, AudioCodes had **$8.3 million** available under its court approval for the repurchase of shares and/or declaration of cash dividends, valid through June 19, 2022[10](index=10&type=chunk) [Corporate Information](index=4&type=section&id=Corporate%20Information) Provides details on investor communications, company profile, and forward-looking statement disclaimers [Conference Call & Web Cast Information](index=4&type=section&id=Conference%20Call%20%26%20Web%20Cast%20Information) AudioCodes held a conference call on **May 2, 2022**, to discuss Q1 2022 results, with a webcast available on their investor website - AudioCodes conducted a conference call on **May 2, 2022**, at **8:30 A.M. Eastern Time** to discuss **Q1 2022** results, with a simultaneous webcast available on their investor website[12](index=12&type=chunk) [About AudioCodes](index=5&type=section&id=About%20AudioCodes) AudioCodes is a leading global vendor of advanced communications software and solutions for digital workplace voice networks - AudioCodes is a leading vendor of advanced communications software, products, and productivity solutions for the digital workplace, enabling all-IP voice networks for unified communications, contact centers, and hosted business services[14](index=14&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) Statements about future outlook are forward-looking and subject to various risks, with no obligation for updates - Statements regarding business outlook, future economic performance, product introductions, and plans are 'forward-looking statements' subject to risks such as global economic conditions, market acceptance, competition, timely product development, financing, acquisition disruptions, and the COVID-19 pandemic[15](index=15&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) Presents the company's balance sheets, statements of operations, and cash flows for Q1 2022 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$320.98 million** from **$349.36 million**, primarily due to reduced cash and equivalents Key Balance Sheet Items (USD thousands) | Metric | March 31, 2022 (Unaudited) | December 31, 2021 (Audited) | Change | | :-------------------------- | :------------------------- | :-------------------------- | :----- | | Cash and cash equivalents | 37,978 | 79,423 | (41,445) | | Total current assets | 129,592 | 167,553 | (37,961) | | Total assets | 320,976 | 349,364 | (28,388) | | Total current liabilities | 89,773 | 95,943 | (6,170) | | Total long-term liabilities | 43,539 | 47,923 | (4,384) | | Total shareholders' equity | 187,664 | 205,498 | (17,834) | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Total revenues increased to **$66.36 million**, but higher operating expenses led to decreased operating and net income Revenue and Gross Profit (USD thousands) | Metric | Q1 2022 (Unaudited) | Q1 2021 (Unaudited) | Change | | :------------- | :------------------ | :------------------ | :----- | | Products | 38,820 | 37,021 | 1,799 | | Services | 27,537 | 21,817 | 5,720 | | Total Revenues | 66,357 | 58,838 | 7,519 | | Gross profit | 44,360 | 40,271 | 4,089 | Operating Expenses and Income (USD thousands) | Metric | Q1 2022 (Unaudited) | Q1 2021 (Unaudited) | Change | | :-------------------------- | :------------------ | :------------------ | :----- | | Research and development, net | 14,982 | 12,047 | 2,935 | | Selling and marketing | 17,288 | 14,476 | 2,812 | | General and administrative | 4,038 | 3,625 | 413 | | Total operating expenses | 36,308 | 30,148 | 6,160 | | Operating income | 8,052 | 10,123 | (2,071) | [GAAP Results](index=7&type=section&id=GAAP%20Results) GAAP net income decreased to **$8.61 million** (**$0.26 per diluted share**) despite revenue growth, due to higher operating expenses GAAP Net Income and EPS (USD thousands) | Metric | Q1 2022 (Unaudited) | Q1 2021 (Unaudited) | Change | | :---------------------- | :------------------ | :------------------ | :----- | | Net income | 8,608 | 9,993 | (1,385) | | Basic net earnings per share | $0.27 | $0.30 | ($0.03) | | Diluted net earnings per share | $0.26 | $0.29 | ($0.03) | [Non-GAAP Reconciliation](index=8&type=section&id=Non-GAAP%20Reconciliation) Non-GAAP net income was **$11.16 million** (**$0.33 per diluted share**), with adjustments for share-based compensation and amortization Non-GAAP Net Income and EPS (USD thousands) | Metric | Q1 2022 (Unaudited) | Q1 2021 (Unaudited) | Change | | :------------------------------ | :------------------ | :------------------ | :----- | | Non-GAAP net income | 11,162 | 12,743 | (1,581) | | Non-GAAP diluted net earnings per share | $0.33 | $0.37 | ($0.04) | - Non-GAAP net income excludes share-based compensation, amortization of intangible assets, deferred payments expenses from the Callverso acquisition, other income from lease termination, financial income from exchange rate differences, and non-cash deferred tax expenses[4](index=4&type=chunk)[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow significantly decreased, with higher investing and financing outflows leading to a **$46.55 million** cash reduction Cash Flows Summary (USD thousands) | Cash Flow Activity | Q1 2022 (Unaudited) | Q1 2021 (Unaudited) | Change | | :------------------------------ | :------------------ | :------------------ | :----- | | Net cash provided by operating activities | 938 | 13,020 | (12,082) | | Net cash provided by (used in) investing activities | (20,787) | 69,739 | (90,526) | | Net cash used in financing activities | (26,696) | (15,445) | (11,251) | | Net increase (decrease) in cash, cash equivalents, and restricted cash | (46,545) | 67,314 | (113,859) | - The significant decrease in cash from investing activities was primarily due to a **$15.4 million** purchase of long-term financial investments and a **$5 million** investment in short-term deposits in **Q1 2022**, compared to proceeds from short-term deposits in **Q1 2021**[22](index=22&type=chunk) - The increased net cash used in financing activities was mainly driven by higher purchases of treasury shares (**$20.87 million** in **Q1 2022** vs **$10.26 million** in **Q1 2021**) and cash dividends paid to shareholders (**$5.83 million** in **Q1 2022** vs **$5.30 million** in **Q1 2021**)[24](index=24&type=chunk)

AudioCodes Ltd. (NASDAQ:AUDC) Q4 2021 Earnings Conference Call February 1, 2022 8:30 AM ET Company Participants Roger Chuchen - Vice President-Investor Relations Shabtai Adlersberg - President and Chief Executive Officer Niran Baruch - Vice President-Finance and Chief Financial Officer Conference Call Participants Ryan MacWilliams - Barclays Bank PLC Greg Burns - Sidoti and Company Samad Samana - Jefferies Ryan Koontz - Needham & Company, LLC Tal Liani - Bank of America Merrill Lynch Operator Good day ladie ...

AudioCodes Ltd. (NASDAQ:AUDC) Q3 2021 Earnings Conference Call October 26, 2021 8:30 AM ET Company Participants Roger Chuchen – Vice President-Investor Relations Shabtai Adlersberg – President and Chief Executive Officer Niran Baruch – Vice President-Finance and Chief Financial Officer Conference Call Participants Greg Burns – Sidoti and Company Ryan MacWilliams – Barclays Bank PLC Samad Samana – Jefferies Tal Liani – Bank of America Operator Good day ladies and gentlemen and welcome to AudioCodes' Third Qu ...

```markdown [Third Quarter 2021 Performance Overview](index=1&type=section&id=Third%20Quarter%202021%20Performance%20Overview) AudioCodes achieved strong Q3 2021 financial results, marked by significant revenue growth, solid profitability, and strategic operational advancements [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) AudioCodes reported strong Q3 2021 financial results with significant year-over-year revenue growth, particularly in service revenues. Both GAAP and Non-GAAP net income and operating margins showed solid performance, alongside positive operating cash flow and share repurchases Key Financial Highlights Table | Metric | Q3 2021 | YoY Change | | :-------------------------------- | :------ | :--------- | | Quarterly Revenues | $63.4 million | +12.1% | | Quarterly Service Revenues | $24.8 million | +26.7% | | GAAP Gross Margin | 69.6% | - | | GAAP Operating Margin | 15.8% | - | | GAAP Net Income | $8.3 million | - | | GAAP Diluted EPS | $0.24 | - | | Non-GAAP Gross Margin | 69.9% | - | | Non-GAAP Operating Margin | 21.4% | - | | Non-GAAP Net Income | $12.9 million | - | | Non-GAAP Diluted EPS | $0.38 | - | | Net cash provided by operating activities | $13.0 million | - | - AudioCodes repurchased **424,307 ordinary shares** during the quarter at an aggregate cost of **$13.8 million**[2](index=2&type=chunk) [Operational and Strategic Highlights](index=2&type=section&id=Operational%20and%20Strategic%20Highlights) The company experienced continued momentum in its enterprise operations, driven by UCaaS and Contact Center markets, which contributed significantly to overall revenue growth. Services revenue also expanded, fueled by cloud communications and the AudioCodes Live offering, with Voice.ai bookings showing substantial growth - Enterprise business contributed close to **85% of Q3 revenues** and generated growth of **above 20% year-over-year**[7](index=7&type=chunk) - UCaaS business grew about **18% year-over-year** and contact center business grew **more than 20% year-over-year**[7](index=7&type=chunk) - Services revenues grew **more than 25% year-over-year**, representing close to **40% of Q3 revenue**, driven primarily by professional and managed services offerings and the shift towards cloud communications[8](index=8&type=chunk) - Voice.ai bookings grew **more than 100% year-over-year** for both the three and nine-month periods ended **September 30, 2021**, with a forecast to reach **$5 million** for the full year **2021**[8](index=8&type=chunk) [Detailed Financial Analysis](index=2&type=section&id=Detailed%20Financial%20Analysis) This section provides an in-depth analysis of AudioCodes' Q3 2021 financial performance, covering revenue, profitability, and cash flow dynamics [Revenue and Profitability](index=2&type=section&id=Revenue%20and%20Profitability) AudioCodes reported Q3 2021 revenues of $63.4 million, an increase from both Q2 2021 and Q3 2020. GAAP net income rose to $8.3 million, while Non-GAAP net income was $12.9 million, slightly down from Q3 2020 on a Non-GAAP basis Revenue and Profitability Table | Metric | Q3 2021 | Q2 2021 | Q3 2020 | | :------- | :------ | :------ | :------ | | Revenues | $63.4 million | $60.6 million | $56.6 million | | Net Income (GAAP) | $8.3 million | - | $7.0 million | | Diluted EPS (GAAP) | $0.24 | - | $0.20 | | Net Income (Non-GAAP) | $12.9 million | - | $13.3 million | | Diluted EPS (Non-GAAP) | $0.38 | - | $0.38 | [GAAP Results](index=8&type=section&id=GAAP%20Results) GAAP gross margin was 69.6%, operating margin was 15.8%, and net income was $8.3 million, or $0.24 per diluted share for Q3 2021 GAAP Results ($ in thousands) | Metric | Q3 2021 (GAAP) | Q3 2020 (GAAP) | | :-------------------- | :------------- | :------------- | | Total Revenues | $63,408 | $56,564 | | Gross Profit | $44,123 | $37,979 | | Operating Income | $9,998 | $11,225 | | Net Income | $8,263 | $6,964 | | Basic Net EPS | $0.25 | $0.21 | | Diluted Net EPS | $0.24 | $0.20 | [Non-GAAP Results](index=9&type=section&id=Non-GAAP%20Results) Non-GAAP gross margin was 69.9%, operating margin was 21.4%, and net income was $12.9 million, or $0.38 per diluted share for Q3 2021. Non-GAAP net income excludes share-based compensation, acquisition-related amortization, exchange rate differences, and non-cash deferred tax expenses Non-GAAP Results ($ in thousands) | Metric | Q3 2021 (Non-GAAP) | Q3 2020 (Non-GAAP) | | :-------------------------- | :----------------- | :----------------- | | Non-GAAP Net Income | $12,939 | $13,250 | | Non-GAAP Diluted Net EPS | $0.38 | $0.38 | - Non-GAAP net income excludes: (i) share-based compensation expenses; (ii) amortization expenses related to the acquisition of Active Communications Europe assets; (iii) financial income or expenses related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies and (iv) non-cash deferred tax expenses[5](index=5&type=chunk)[21](index=21&type=chunk) [Cash Flow and Liquidity](index=2&type=section&id=Cash%20Flow%20and%20Liquidity) AudioCodes generated $13.0 million in net cash from operating activities in Q3 2021. Total cash, cash equivalents, and marketable securities stood at $184.9 million as of September 30, 2021, slightly down from year-end 2020 due to share repurchases and dividend payments largely offset by operating cash generation Cash Flow and Liquidity Table | Metric | Q3 2021 | | :------------------------------------------------------------------------------------------------ | :------ | | Net cash provided by operating activities | $13.0 million | Cash Flow and Liquidity Table | Metric | Sep 30, 2021 | Dec 31, 2020 | | :------------------------------------------------------------------------------------------------ | :----------- | :----------- | | Cash and cash equivalents, long and short-term bank deposits and long and short-term marketable securities | $184.9 million | $186.3 million | - The use of cash for share repurchases and cash dividends during **2021** was basically offset by cash generated from operating activities[6](index=6&type=chunk) [Capital Management](index=3&type=section&id=Capital%20Management) AudioCodes actively managed its capital through share repurchases and cash dividend distributions during the quarter [Share Repurchase Program](index=3&type=section&id=Share%20Repurchase%20Program) AudioCodes repurchased 424,307 ordinary shares for $13.8 million during Q3 2021 under a court-approved program allowing up to $35 million in additional repurchases or dividends through January 2022 - During **Q3 2021**, the Company acquired **424,307 of its ordinary shares** for a total consideration of **$13.8 million**[9](index=9&type=chunk) - In **July 2021**, court approval was received to purchase up to an aggregate amount of **$35 million of additional ordinary shares**, valid through **January 03, 2022**[9](index=9&type=chunk) [Cash Dividend](index=3&type=section&id=Cash%20Dividend) The company declared and paid a cash dividend of $0.17 per share, totaling approximately $5.6 million, in August 2021 - On **July 27, 2021**, the Company declared a cash dividend of **$0.17 per share**[10](index=10&type=chunk) - The dividend, in the aggregate amount of approximately **$5.6 million**, was paid on **August 26, 2021**[10](index=10&type=chunk) - The dividend is subject to Israeli withholding tax at source at the rate of **25%** (or **30%** for holders of **10% or more of share capital**)[10](index=10&type=chunk) [Company Information](index=4&type=section&id=Company%20Information) This section provides an overview of AudioCodes' business, outlines forward-looking statement disclaimers, and details investor communication channels [About AudioCodes](index=5&type=section&id=About%20AudioCodes) AudioCodes Ltd. is a leading vendor of advanced communications software, products, and productivity solutions for the digital workplace, enabling all-IP voice networks for unified communications, contact centers, and hosted business services globally - AudioCodes Ltd. is a leading vendor of advanced communications software, products and productivity solutions for the digital workplace[14](index=14&type=chunk) - The company enables enterprises and service providers to build and operate all-IP voice networks for unified communications, contact centers, and hosted business services[14](index=14&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) The press release contains forward-looking statements subject to various risks and uncertainties, including global economic conditions, market acceptance, competition, technology development, financing needs, acquisition integration, and the impact of the COVID-19 pandemic. AudioCodes disclaims any obligation to update this information - Statements concerning AudioCodes' business outlook or future economic performance are 'forward-looking statements' subject to various risks, uncertainties, and other factors[15](index=15&type=chunk) - Risks include global economic conditions, shifts in supply and demand, market acceptance of new products, competitive impact, technology development, financing needs, acquisition disruptions, and the COVID-19 pandemic[15](index=15&type=chunk) - AudioCodes assumes no obligation to update the information in this release[15](index=15&type=chunk) [Investor Information](index=4&type=section&id=Investor%20Information) AudioCodes provided details for its Q3 2021 earnings conference call and webcast, along with links to its investor website and social media channels for further engagement - AudioCodes conducted a conference call and webcast on **October 26, 2021**, to discuss **Q3 2021** operating performance, financial results, and outlook[11](index=11&type=chunk) - Investors can access the webcast via the AudioCodes investor website at http://www.audiocodes.com/investors-lobby and follow social media channels[11](index=11&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents AudioCodes' condensed consolidated balance sheets, statements of operations, and cash flows, including GAAP to Non-GAAP reconciliations for Q3 2021 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of September 30, 2021, AudioCodes reported total assets of $350.09 million, a decrease from $358.12 million at December 31, 2020. Current assets decreased, while long-term marketable securities significantly increased. Total liabilities also decreased, leading to a slight reduction in total shareholders' equity Condensed Consolidated Balance Sheets ($ in thousands) | Balance Sheet Item | Sep 30, 2021 (Unaudited) | Dec 31, 2020 (Audited) | | :--------------------------------------------- | :----------------------- | :--------------------- | | Total Assets | $350,086 | $358,123 | | Total Current Assets | $166,876 | $203,642 | | Cash and cash equivalents | $88,448 | $40,934 | | Short-term and restricted bank deposits | $363 | $84,817 | | Long-term marketable securities and accrued interest | $90,133 | $54,895 | | Total Liabilities | $146,585 | $148,268 | | Total Shareholders' Equity | $203,501 | $209,855 | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q3 2021, total revenues increased to $63.41 million from $56.56 million in Q3 2020, driven by growth in both products and services. Gross profit improved, but operating income decreased year-over-year due to higher operating expenses, resulting in a GAAP net income of $8.26 million, up from $6.96 million in Q3 2020 Condensed Consolidated Statements of Operations ($ in thousands) | Metric | Q3 2021 | Q3 2020 | | :-------------------------- | :------ | :------ | | Total Revenues | $63,408 | $56,564 | | Products Revenues | $38,610 | $36,987 | | Services Revenues | $24,798 | $19,577 | | Gross profit | $44,123 | $37,979 | | Total operating expenses | $34,125 | $26,754 | | Operating income | $9,998 | $11,225 | | Net income | $8,263 | $6,964 | | Diluted net earnings per share | $0.24 | $0.20 | [Reconciliation of GAAP to Non-GAAP Net Income](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Net%20Income) The reconciliation shows that Non-GAAP net income for Q3 2021 was $12.94 million ($0.38 diluted EPS), compared to GAAP net income of $8.26 million ($0.24 diluted EPS). Key adjustments include share-based compensation, amortization expenses, exchange rate differences, and deferred tax expenses Reconciliation of GAAP to Non-GAAP Net Income ($ in thousands) | Metric | Q3 2021 | Q3 2020 | | :-------------------------------- | :------ | :------ | | GAAP net income | $8,263 | $6,964 | | GAAP net earnings per share | $0.24 | $0.20 | | Share-based compensation (total) | $3,474 | $2,097 | | Amortization expenses (total) | $70 | $83 | | Exchange rate differences | $38 | $(418) | | Deferred tax | $1,094 | $4,524 | | Non-GAAP net income | $12,939 | $13,250 | | Non-GAAP diluted net earnings per share | $0.38 | $0.38 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) AudioCodes generated $13.01 million in net cash from operating activities in Q3 2021, an increase from $10.87 million in Q3 2020. Investing activities resulted in a net cash outflow of $21.88 million, primarily due to marketable securities purchases. Financing activities showed a net outflow of $19.10 million, mainly due to share repurchases and cash dividends Condensed Consolidated Statements of Cash Flows ($ in thousands) | Cash Flow Activity | Q3 2021 | Q3 2020 | | :---------------------------------------------------- | :------ | :------ | | Net cash provided by operating activities | $13,013 | $10,874 | | Net cash provided by (used in) investing activities | $(21,884) | $(111,837) | | Net cash provided by (used in) financing activities | $(19,102) | $(4,251) | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $(27,973) | $(105,214) | | Cash, cash equivalents and restricted cash at end of period | $93,548 | $63,635 | - Key financing outflows in **Q3 2021** included the purchase of treasury shares (**$13.848 million**) and cash dividends paid to shareholders (**$5.563 million**)[25](index=25&type=chunk) ```

AudioCodes Ltd. (NASDAQ:AUDC) Q2 2021 Earnings Conference Call July 27, 2021 8:30 AM ET Company Participants Roger Chuchen - VP, IR Shabtai Adlersberg - President and CEO Niran Baruch - CFO, and VP of Finance Conference Call Participants Samad Samana - Jefferies Greg Burns - Sidoti & Company Ethan Etzioni - Etzioni Portfolio Management Operator Greetings, and welcome to the AudioCodes's Second Quarter 2021 Earnings Call. At this time all participants are in a listen-only mode. A question-and-answer session ...

AudioCodes Ltd. (NASDAQ:AUDC) Q1 2021 Earnings Conference Call April 27, 2021 8:30 AM ET Company Participants Roger Chuchen - VP, Investor Relations Shabtai Adlersberg - President and Chief Executive Officer Niran Baruch - Chief Financial Officer Conference Call Participants Samad Samana - Jefferies Raimo Lenschow - Barclays Greg Burns - Sidoti & Company Operator Hello and welcome to the AudioCodes's First Quarter 2021 Earnings Conference Call. At this time all participants are in a listen-only mode. A que ...