Ceragon Reports Third-Quarter Financial Results
Monday, November 04, 2019 | Comments

Ceragon Networks reported financial results for the third quarter that ended Sept. 30. Third-quarter revenues were $72.2 million, down 16.6% from the third quarter of 2018, and down 1.1% from the second quarter of 2019.

Gross margin was 32.2%, compared with 35% in the third quarter of 2018 and 36.1% in the second quarter of 2019. The company’s $2.1 million in operating income for the quarter compares to $7.9 million in the third quarter of 2018, and $4.1 million in the second quarter of 2019.

Net income of $200,000 for the third quarter compared with $6.2 million in the third quarter of 2018. Net income for the second quarter of 2019 was $800,000.

The company had cash and cash equivalents of $20.5 million at Sept. 30 compared to $29 million at June 30.

"Results in quarter three were affected mainly by the slowdown in India and a delay in one large project in Latin America," said Ira Palti, president and CEO of Ceragon. "We are seeing areas of strength in demand, excluding India, and we expect revenue in most regions to improve in quarter four and also during 2020, allowing for typical seasonality in quarter one. Driving overall growth next year, particularly in the second half, will be new 5G design wins we currently have in hand.

"Like many other companies in our industry, we have found it necessary to adjust our short-term expectations based on growing global uncertainties such as trade and economic trends causing a more cautious spending environment, coupled with the specific challenges facing operators as they gear up to 5G technology. During this period of transition, we intend to focus on reinforcing our technology leadership with ongoing investment in R&D (research and development), maintaining our financial strength with tight expense control, strong working capital management and remaining resilient to fully capitalize on the ramp in 5G deployments."

Geographical breakdown of revenue for the third quarter included 29% of revenue from India and 22% from Asia Pacific. Latin America accounted for 17% of revenue, followed by Europe at 15%, North America at 11% and Africa at 6%.

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