Lantronix, Inc. (NASDAQ:LTRX) Q1 2025 Earnings Conference Call November 7, 2024 6:30 PM ET Company Participants Brent Stringham - Chief Accounting Officer and Interim CFO Saleel Awsare - President and CEO Conference Call Participants Tyler Burmeister - Craig-Hallum Capital Ryan Koontz - Needham Operator Good evening, and welcome to the Lantronix First Quarter Fiscal 2025 Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded. ...

Core Insights - Lantronix Inc. has announced a strategic partnership with DZS, Inc. and NetComm Wireless Pty Ltd to enhance its 5G product offerings, aiming to fill gaps in its product line and meet increasing customer demand for 5G solutions [1][2] Group 1: Partnership and Product Development - The collaboration with DZS and NetComm is expected to strengthen Lantronix's capabilities in providing 5G solutions, which are crucial for the company's growth strategy [1] - Lantronix anticipates that the partnership will enable it to deliver enhanced customer solutions and expand its market reach in the 5G sector [1][2] - The company projects that the partnership will contribute to significant revenue growth, with expectations of generating between $600 million to $700 million in revenue for the fiscal year 2024 [1] Group 2: Market Position and Future Outlook - Lantronix aims to leverage the partnership to address the growing demand for 5G products, which are essential for various applications including automotive and industrial sectors [2] - The company is focused on enhancing its product offerings to ensure they meet the evolving needs of customers in a competitive market [2] - Lantronix's strategic initiatives are expected to position it favorably within the industry, particularly as the demand for 5G solutions continues to rise [1][2]

Revenue Performance - For the three months ended September 30, 2024, net revenue increased by $1,392,000 or 4.2% compared to the same period in 2023, driven by a 17.7% increase in the Embedded IoT Solutions product line [98]. - Embedded IoT Solutions generated $13,387,000 in revenue, accounting for 38.9% of total net revenue, while IoT System Solutions and Software & Services generated $18,759,000 (54.5%) and $2,277,000 (6.6%) respectively [100]. - The Americas region saw a significant revenue decline of $5,513,000 or 24.0%, while EMEA and APJ regions experienced increases of 59.1% and 85.9% respectively [101]. Profitability and Expenses - Gross profit for the three months ended September 30, 2024, was $14,475,000, representing a gross margin of 42.1%, slightly down from 42.7% in the prior year [106]. - Selling, general and administrative expenses increased to $9,496,000, a rise of $326,000 or 3.6%, primarily due to higher personnel-related costs [108]. - Research and development expenses totaled $4,956,000, accounting for 14.4% of net revenue, a decrease of $150,000 or 2.9% compared to the previous year [111]. - Restructuring and severance charges amounted to $900,000 for the three months ended September 30, 2024, a significant increase from $20,000 in the same period of 2023 [112]. - The company reported a net loss of $2,502,000 for the three months ended September 30, 2024, compared to a net loss of $1,886,000 in the prior year [98]. - Operating expenses increased by $932,000, primarily due to restructuring and severance charges, partially offset by revenue growth [98]. Cash Flow and Working Capital - Working capital decreased by $1,679,000 from June 30, 2024, to September 30, 2024, totaling $57,115,000 [117]. - Cash and cash equivalents increased by $158,000, reaching $26,395,000 as of September 30, 2024 [117]. - Net cash provided by operating activities decreased by $4,835,000, totaling $2,663,000 for the three months ended September 30, 2024 [126]. - Net inventories increased by $1,835,000, or 6.6%, from June 30, 2024, to September 30, 2024 [125]. - Accounts payable increased by $6,802,000, or 65.7%, from June 30, 2024, to September 30, 2024 [125]. - Contract manufacturers' receivables increased by $1,321,000, or 94.3%, from June 30, 2024, to September 30, 2024 [128]. - Net cash used in investing activities was $157,000 for the three months ended September 30, 2024, compared to $486,000 in the prior year [129]. - Net cash used in financing activities increased by $1,363,000, totaling $2,348,000 for the three months ended September 30, 2024 [126]. - The company anticipates that primary factors affecting cash and liquidity include net revenue, working capital requirements, and capital expenditures [121]. - The company is in compliance with all covenants of the Loan Agreement as of the date of the report [119]. Strategic Focus - The company continues to focus on high-growth industries such as Smart Cities, Automotive, and Enterprise markets, leveraging its IoT solutions to capitalize on market opportunities [88].

Core Viewpoint - Lantronix, Inc. reported quarterly earnings of $0.06 per share, missing the Zacks Consensus Estimate of $0.09 per share, representing a -33.33% earnings surprise [1][2] Financial Performance - The company posted revenues of $34.42 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 7.22%, compared to $33.03 million in the same quarter last year [2] - Over the last four quarters, Lantronix has surpassed consensus EPS estimates only once and has topped consensus revenue estimates just once [2] Stock Performance - Lantronix shares have declined approximately 34.8% since the beginning of the year, contrasting with the S&P 500's gain of 24.3% [3] Future Outlook - The company's earnings outlook will be crucial for stock performance, with current consensus EPS estimates at $0.11 for the coming quarter and $0.46 for the current fiscal year, with revenues expected to be $39.3 million and $159.8 million respectively [7] - The Zacks Rank for Lantronix is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Computer - Networking industry, to which Lantronix belongs, is currently in the top 11% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% of industries [8]

First Quarter Net Revenue of $34.4 Million, up 4 Percent Year-Over-YearFirst Quarter GAAP EPS of ($0.07) vs. ($0.05) in the Prior Year First Quarter Non-GAAP EPS of $0.06 vs. $0.07 in the Prior Year IRVINE, Calif., Nov. 07, 2024 (GLOBE NEWSWIRE) -- Lantronix Inc. (NASDAQ: LTRX), a global leader of compute and connectivity IoT solutions, today reported results for its first quarter of fiscal 2025. Net revenue totaled $34.4 million, up 4 percent year-over-year and down sequentially as expected. GAAP EPS of ($ ...

IRVINE, Calif., Oct. 31, 2024 (GLOBE NEWSWIRE) -- Lantronix Inc. (the “Company”) (NASDAQ: LTRX), a global leader of compute and connectivity IoT solutions, today announced it will release financial results from its fiscal 2025 first quarter ended Sept. 30, 2024, after the close of the market on Thursday, Nov. 7, 2024. Management will host an investor conference call and audio webcast at 3:30 p.m. Pacific Time (6:30 p.m. Eastern Time) on Nov. 7, 2024. To access the live conference call, investors should dial ...

Core Insights - Lantronix, Inc. has launched the SmartLV, an AI-powered IoT Edge Compute Cellular Gateway aimed at enhancing low-voltage substations and distribution automation in smart grids and industrial applications [1] - The SmartLV Gateway is designed to provide real-time visibility, control, and automation for Distribution System Operators (DSOs), optimizing energy flow and ensuring grid stability [2] Product Features - The SmartLV Gateway features Multi-Protocol Communication, supporting various interfaces such as Ethernet, Serial, and industrial protocol conversion, ensuring compatibility with both legacy and modern systems [3] - It is LTE and 5G-ready, enabling high-speed data transmission for quick decision-making by DSOs [3] - The AI-driven edge computing capability allows for low-latency analysis at the substation level, improving grid efficiency and response times [3] Cybersecurity and Management - The SmartLV Gateway includes InfiniShield, a cybersecurity framework designed to protect against evolving cyber threats [4] - Lantronix's Percepxion IoT Edge Platform simplifies deployment management for DSOs, integrating features like global cellular plans and VPN security [4] Strategic Partnerships - The development of the SmartLV Gateway is a result of collaboration between Lantronix and Qualcomm, leveraging both companies' expertise to address challenges in the energy sector [5] - Recently, five new System-in-Package (SiP) solutions were introduced, enhancing industrial and enterprise IoT capabilities [5] Financial Performance - The IoT System Solutions business saw a significant revenue increase of 156% year-over-year, while the Embedded IoT Solutions and Software & Services segments experienced declines of 40% and 3.2%, respectively [6] - Lantronix currently holds a Zacks Rank of 4 (Sell), with shares declining by 5.5% over the past year compared to a 4.3% growth in the sub-industry [7]

Core Viewpoint - Lantronix Inc. has launched SmartLV, the first AI-enabled IoT Edge Compute Cellular Gateway, aimed at enhancing real-time visibility, control, and automation in the energy sector, particularly for low-voltage substations and distribution automation applications [1][2][3]. Product Features - SmartLV is designed for Distribution System Operators (DSOs) to manage energy precisely, ensuring robust operations with advanced cybersecurity and AI capabilities [2][4]. - Key features include multi-protocol communication for integration with existing infrastructure, high-speed LTE and 5G-ready connectivity, AI-enabled edge computing for real-time decision-making, and advanced cybersecurity through Lantronix's InfiniShield™ security framework [4]. - The product also offers simplified management through Lantronix's Percepxion™ IoT Edge Platform, enabling automated control of Distributed Energy Resources (DERs) based on actual grid conditions [4]. Industry Impact - The SmartLV Gateway represents a significant advancement in energy management, allowing utility operators to optimize energy flow and maintain stability during peak loads, thus addressing critical challenges in smart grid operations [3][4]. - This innovation is part of a long-standing collaboration between Qualcomm Technologies and Lantronix, combining AI and connectivity to transform energy delivery and consumption [5]. Availability - The SmartLV Gateway is set to launch in calendar year 2025, with trials beginning at the end of calendar year 2024 for selected DSOs [6].

Lantronix, Inc. (LTRX) recently launched five new System-in-Package (SiP) solutions. These modules, powered by Qualcomm Technologies' (QCOM) cutting-edge processors, are poised to redefine industrial and enterprise Internet of Things (IoT) possibilities, combining leading-edge performance, scalability and cost efficiency. These innovative SiP solutions are tailored to cater to the growing demand for efficient and reliable artificial intelligence (AI)-powered systems across various industries, including robo ...

Core Insights - Lantronix Inc. has launched new System-in-Package (SiP) solutions powered by Qualcomm Technologies' chipsets, enhancing its position in industrial and enterprise IoT innovation with advanced AI and ML capabilities at the edge [1][2][3] Product Offerings - The new SiP families include five distinct series designed for various applications such as robotics, industrial automation, video surveillance, and drones, emphasizing performance and cost efficiency [2][3] - The IQ9 Series SiPs provide robust computing for autonomous devices, featuring safety functions, fault tolerance, and support for multiple cameras, enhancing robot perception and navigation [5] - The Open-Q 8550CS family focuses on advanced video and AI applications, offering high AI performance and connectivity options, suitable for demanding edge computing tasks [7][8] - The Open-Q 6490CS and 5430CS families allow for scalable AI solutions with low-power performance and advanced multimedia capabilities, supporting multiple camera streams for video-intensive applications [9] Strategic Collaboration - Lantronix has maintained a strong partnership with Qualcomm Technologies for over 15 years, leveraging Qualcomm's processors to deliver reliable, industrial-grade systems that facilitate the deployment of AI solutions at the edge [2][3] Technological Advancements - The Qualcomm AI Hub integrated into Lantronix's SiP solutions provides access to over 100 AI models and optimizes AI capabilities, achieving performance metrics ranging from 3.5 to 100 INT-8 TOPS [4]