DZS(US:DZSI)2024-11-06 13:03Financial Performance - Q3 2024 orders totaled $27.2 million, a decrease of 5.8% compared to $28.9 million in Q3 2023, and $94.2 million for the first nine months of 2024, down 6.7% from $101.0 million in the same period last year[3]. - Net revenue for Q3 2024 was $38.1 million, representing a 22.8% increase from $31.1 million in Q2 2024[3]. - Net revenue for Q3 2024 reached $38,149 million, a 22.5% increase from $31,066 million in Q2 2024 and a 67.5% increase from $22,737 million in Q3 2023[16]. - Gross profit for Q3 2024 was $11,225 million, compared to $10,439 million in Q2 2024, marking an increase of 7.5%[16]. - Operating loss for Q3 2024 was $(22,002) million, worsening from $(17,166) million in Q2 2024 but improving from $(30,382) million in Q3 2023[16]. - Net loss for Q3 2024 was $(25,646) million, compared to a net income of $23,073 million in Q2 2024, reflecting significant operational challenges[16]. - Adjusted EBITDA for Q3 2024 was $(9,323) million, compared to $(7,267) million in Q2 2024, indicating ongoing financial strain[19]. Margins and Income - GAAP gross margin improved to 29.4% in Q3 2024, compared to (4.6%) in Q3 2023, and 35.4% for the first nine months of 2024, up from 26.8% in the same period last year[3]. - Non-GAAP gross margin for Q3 2024 was 36.7%, compared to 17.4% in Q3 2023, and 38.6% for the first nine months of 2024, up from 33.3% year-over-year[3]. - Net income for Q3 2024 was $(25.7) million GAAP, an improvement from $(29.4) million in Q3 2023, and adjusted non-GAAP net income was $(11.7) million, compared to $(15.3) million in Q3 2023[3]. - Gross profit loss of $1,037 million, leading to a gross margin percentage of -4.6% for the three months ended September 30, 2023[22]. - Non-GAAP adjusted amount of $18,773 million, with a gross margin percentage of 17.4%[22]. Expenses and Liabilities - Total operating expenses increased to $33,227 million in Q3 2024, up from $27,605 million in Q2 2024, primarily driven by higher research and development costs of $10,656 million[16]. - Long-term debt increased to $16,424 million in September 2024, up from $7,308 million in December 2023, suggesting increased leverage[17]. - Total current liabilities decreased to $110,081 million in September 2024 from $165,811 million in December 2023, indicating improved short-term financial health[17]. - Operating income loss of $50,060 million, with operating expenses totaling $84,337 million[23]. - Restructuring and other charges amounted to $5,230 million, representing 5.4% of total revenue[24]. - Stock-based compensation expenses of $10,934 million, accounting for 0.9% of total revenue[24]. - Litigation and restatement costs of $4,117 million, contributing to the overall net income loss[24]. Cash and Inventory - Cash balance at the end of Q3 2024 was $5.7 million, with inventory standing at $79 million[3]. - Cash and cash equivalents decreased to $5,736 million as of September 2024, down from $15,102 million at the end of December 2023[17]. - DZS is focused on converting $79 million of inventory into cash and delivering to customers as part of its ongoing operational strategy[5]. Strategic Goals - The company aims to achieve break-even Adjusted EBITDA by 2025, leveraging cost savings and synergies from the NetComm acquisition[5]. - The company has made progress on key performance initiatives, including strengthening its balance sheet and optimizing its cost structure[2].