iRobot (IRBT) Incurs Narrower-Than-Expected Net Loss in Q1

Core Viewpoint - iRobot Corporation reported a narrower adjusted loss per share of $1.53 for Q1 2024, compared to the Zacks Consensus Estimate of a loss of $2.03 and a net loss of $1.67 in the same quarter last year [1] Revenue Details - iRobot generated revenues of $150 million in Q1 2024, exceeding the Zacks Consensus Estimate of $139 million, but reflecting a 6.4% year-over-year decline due to lower sales across all product categories [2] - Premium and mid-tier robots accounted for 81% of total robot revenues, down from 88% in the year-ago quarter [2] - Total product units shipped were 456 thousand, a 4.6% increase year-over-year, while average selling prices decreased by 13.9% [2] - Revenues from solo and other products were $94 million, down 30.4% year-over-year, with units shipped declining by 28.4% [2] - Revenues from 2-in-1 products increased by 124% year-over-year to $56 million, with units shipped rising from 63 thousand to 189 thousand [2] Regional Performance - Domestic operations contributed 45.9% of revenues, totaling $68.9 million, which is a 4.3% decline year-over-year [3] - International revenues decreased by 8.2% year-over-year to $81.1 million [3] Margin Profile - Cost of revenues decreased by 7.8% year-over-year to $113.9 million, while adjusted gross profit was $36.9 million, down 2.6% year-over-year [4] - Adjusted gross margin expanded by 90 basis points to 24.6% [4] - Research and development expenses were $33.9 million, down 17.9% year-over-year, and selling and marketing expenses fell by 30.1% to $29.7 million [4] - Adjusted operating loss was $40 million, an improvement from $62.3 million in the prior year, with an adjusted operating margin of (26.6%) compared to (38.9%) in the year-ago quarter [4] Balance Sheet and Cash Flow - As of the end of Q1 2024, iRobot had cash and cash equivalents of $118.4 million, down from $185.1 million at the end of Q4 2023 [5] - Total long-term liabilities decreased to $214.7 million from $250.1 million at the end of Q4 2023 [5] - The company generated net cash of $1.44 billion from operating activities, a significant increase from a net cash outflow of $94.5 million in the prior-year period [5] - Capital expenditures for property and equipment fell by 91.9% year-over-year to $118 million [5] Outlook - For Q2 2024, iRobot expects net sales between $167 million and $172 million, down from $237 million in the same quarter last year [6] - Adjusted gross margin is projected to be between 24% and 25%, with an expected adjusted loss per share of $1.74 to $1.81, higher than the adjusted loss of $1.42 in the previous year [6] - For the full year 2024, net sales are forecasted to be between $815 million and $860 million, a decrease from $891 million reported in 2023 [6][7] - Adjusted gross margin for the full year is anticipated to be between 31% and 33%, with an adjusted loss per share projected between $2.71 and $3.13, which is an improvement from an adjusted loss of $7.73 in 2023 [7]