AstroNova(ALOT) - 2022 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for Q3 2022 increased by 3% year-over-year to $28.9 million, driven by a rebound in the commercial aviation market [7] - Strong bookings reached $32.3 million, up 16% year-over-year and 6% sequentially from Q2 [8] - The company reported a net loss of $425,000 or $0.06 per share on a GAAP basis, while on a non-GAAP basis, net income was $76,000 or $0.01 per share [17] Business Line Data and Key Metrics Changes - Revenue in the Test and Measurement (TNM) segment increased by 35% to $6.9 million, marking the best quarter since Q1 of the previous year [7] - Product navigation revenue declined by 4% to $21.9 million [8] - Service and other revenue rose by 35% compared to the same period last year, primarily in the T&A segment [9] Market Data and Key Metrics Changes - U.S. revenue accounted for approximately 60% of total sales in Q3 [9] - The company is strengthening its product and education teams both domestically and internationally, with new initiatives in Europe, the Middle East, and Africa beginning to yield positive results [10] Company Strategy and Development Direction - The company plans to pursue a hybrid marketing approach that combines high-value in-person events with growth in digital marketing platforms [12] - M&A activity is part of the company's strategic plan, with increased screening of potential deals and hopes to finalize something in the coming quarters [25] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing supply chain constraints but expressed confidence in the ability to fulfill delayed orders in Q4 [8][18] - The company is well-positioned for sequential and year-over-year growth in Q4, supported by strong bookings and a solid backlog [18] Other Important Information - Operating expenses increased by about 8% year-over-year, primarily due to higher R&D expenses for new product development [14] - The company successfully implemented a new enterprise resource planning system, positioning it for future growth [16] Q&A Session Summary Question: What was the revenue impact in Q3 from supply chain issues? - Management indicated that the impact was significant but did not disclose a specific number, noting that they expect to make up for it in Q4 [20][21] Question: Was the recurring revenue number broken out for the quarter? - Management acknowledged the request but did not have the number readily available, promising to follow up [22][23] Question: Is the company looking at M&A for future growth? - Management confirmed that M&A is part of their strategic plan and that they have been actively screening potential deals, with increased activity noted [24][25] Question: Did the new aerospace orders contribute to Q3 results? - Management clarified that the results were primarily from commercial transport, with new aerospace orders expected to contribute in Q4 [26][27]