Aviat Networks(US:AVNW)2020-05-13 04:48Financial Data and Key Metrics Changes - Third quarter revenue increased by approximately 14%, amounting to a $7.3 million increase compared to Q3 of fiscal 2019 [8][16] - Adjusted EBITDA rose by $4 million, reaching $3.5 million, compared to a loss of $0.5 million in the same period last year [8][20] - Non-GAAP net income for Q3 was $2.2 million, a significant improvement from a net loss of $1.8 million in the previous year [20] - Cash and cash equivalents increased to $39.2 million, up $1.1 million sequentially and $7.3 million since the fiscal year began [21] Business Line Data and Key Metrics Changes - North America revenue saw over a 30% increase, contributing to almost 61% of total revenue [16][17] - Product sales increased by over 18%, while services revenue grew by over 5% compared to Q3 of fiscal 2019 [17] - International revenue experienced a decline of approximately 5%, although this was an improvement compared to the first half of the fiscal year [16][17] Market Data and Key Metrics Changes - The APAC region returned to growth with revenue up almost 18% in Q3, while Latin America also showed positive trends [16][34] - North America remains a strong market, with expectations for continued growth in Q4 and the next fiscal year [23] Company Strategy and Development Direction - The company aims to expand its market share through both products and services with existing accounts and target new customer types, particularly mid-size deals [10][12] - Focus on growing with current accounts while targeting tier 2 service providers and larger ISPs to reduce dependency on any single customer [11][12] - Emphasis on operational efficiency and cost reduction to drive profitability and shareholder value [14][25] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about the potential impact of COVID-19 on customer budgets and timelines, but remains optimistic about growth opportunities [23][38] - The company is committed to navigating the challenges posed by COVID-19 and is focused on maintaining a strong cash position [21][25] - Management believes that the differentiation of their value proposition will drive growth in the future [38][60] Other Important Information - The company has suspended its stock buyback program to mitigate uncertainties related to COVID-19 [21] - A restructuring plan is in place, with an expected annualized net savings of approximately $3.5 million [19] Q&A Session Summary Question: Can you provide more details on the North American backlog split? - Management indicated that there were component shortages during the quarter but were able to overcome most issues quickly [27] Question: Was there any business pushed into next quarter due to supply chain issues? - Some service-related revenue was pushed out due to COVID-19, but it was not substantial [29] Question: Can you elaborate on the performance in APAC and Latin America? - Management noted improvements in APAC due to new wins and expects continued growth in that region [34] Question: What are the growth prospects for fiscal 2021? - Management is optimistic about growth in North America and aims to improve international performance as well [37][38] Question: How is the company addressing shareholder value? - The focus is on revenue growth, margin expansion, and operational efficiency to drive shareholder value [58][60]