Ceragon Reports 18.3% Increase in Quarterly Revenue, GAAP EPS of $0.04 Per Share in the Fourth Quarter

Revenue Diversification, Expense Management, Enable Consistent Profitability , /PRNewswire/ -- Ceragon (NASDAQ: CRNT), a leading solutions provider of end-to-end wireless connectivity, today reported its financial results for the fourth quarter period ended December 31, 2024. Q4 2024 Financial Highlights: Revenues of $106.9 million, up 18.3% from $90.4 million in the same quarter last year Operating income of $9.5 million on a GAAP basis, or $12.2 million on a non-GAAP basis Net Income of $3.6 million on a GAAP basis, or $7.7 million on a non-GAAP basis EPS of $0.04 per diluted share on a GAAP basis, or $0.09 per diluted share on a non-GAAP basis FY 2024 Financial Highlights: Revenues of $394.2 million, up 13.5% year-over-year, in-line with full-year guidance and the highest level since 2012 Record Operating income of $38.7 million on a GAAP basis, or a record $48.8 million on a non-GAAP basis Net income of $24.1 million on a GAAP basis, or $36.4 million on a non-GAAP basis EPS of $0.27 per diluted share on a GAAP basis, or $0.41 per diluted share on a non-GAAP basis Q4 2024 Business Highlights: India: all-time record quarterly revenues. Improving visibility in India as commercial terms for 2025 with two major customers are being finalized New IP-50EXA product, including features that have been requested by existing customers in India and other markets, expected to be delivered in the second half of 2025 Pricing and operational efficiency providing advantages vs. competitors North America: Bookings increased sequentially compared to the third quarter Improved bookings from North America and primarily tier-1 service providers offset delays from private network customers Strong quarter in APAC, winning business that included Siklu by Ceragon products "This was a record year for Ceragon, achieving record operating profit on the highest revenue levels since 2012, while continuing to execute our growth strategy," commented Doron Arazi, Ceragon's Chief Executive Officer. "We expanded our presence in the key market of India, grew our private network business, and made two acquisitions that have bolstered our offerings in the fastest-growing segment of the market, the private networks and mmW equipment markets for both private and public networks. I believe we enter 2025 in the strongest competitive position since I joined the company, with best-of-breed solutions targeting a broad pipeline of opportunities in multiple verticals." Arazi concluded, "While near-term visibility across the industry is limited, especially regarding order timing within our core markets from tier-one service providers, we remain cautiously optimistic that 2025 may eventually be a year of growth and improved profitability as we see initial recovery signs in the CSP market, reported by RAN and fiber vendors and as we execute our plans to further increase our market share in private networks." Primary Fourth Quarter 2024 Financial Results: Revenues were $106.9 million, up 18.3% from $90.4 million in Q4 2023 and up 4.1% from $102.7 million in Q3 2024. The revenue for the fourth quarter of 2024 was the highest quarterly revenue level since Q4 2014. GAAP Gross profit was $36.4 million, with gross margins of 34.0%, compared to a gross margin of 34.4% in Q4 2023. GAAP Operating income was $9.5 million compared with $4.2 million in Q4 2023 and $14.6 million for Q3 2024. GAAP Net income (loss) was $3.6 million, or $0.04 per diluted share, compared with $(1.2) million, or $(0.01) per diluted share for Q4 2023 and $12.2 million, or $0.14 per diluted share for Q3 2024. Non-GAAP results were as follows: Gross margin was 34.3%, operating income was $12.2 million, and net income of $7.7 million, or $0.09 per diluted share. Primary Full-Year 2024 Financial Results: Revenues were $394.2 million, up 13.5% from $347.2 million in 2023 and the highest full-year revenue level since 2012. GAAP Gross profit was $136.9 million, with gross margins of 34.7%, compared to a gross margin of 34.5% in 2023. GAAP Operating income was a record $38.7 million compared to $21.2 million for 2023. GAAP Net income was $24.1 million, or $0.27 per diluted share, compared to $6.2 million, or $0.07 per diluted share for 2023. Full-year GAAP net income was the highest since 2008. Non-GAAP results were as follows: Gross margin was 35.1%, operating profit was a record $48.8 million, and net income was $36.4 million, or $0.41 per diluted share. Balance Sheet Cash and cash equivalents were $35.3 million on December 31, 2024, compared to $28.2 at December 31, 2023. For a reconciliation of GAAP to non-GAAP results, see the attached tables. Revenue Breakout by Geography: Q4 2024 India 52 % EMEA 15 % North America 12 % APAC 11 % Latin America 10 % Outlook For 2025, management expects revenue between $390 million and $430 million, inclusive of contributions from the E2E acquisition. Management expects Non-GAAP operating margins to be at least 10% at the low end of this revenue range, with improved free cash flow compared to 2024. Conference Call The Company will host a Zoom web conference today at 8:30 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. Recent geopolitical events could impact the live question and answer session. In this unlikely event, management's prepared remarks will be pre-recorded, and the question and answer session would be rescheduled. The Company will host a Zoom conference call on the same day at 8:30 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. Investors are invited to register by clicking here. All relevant information will be sent upon registration. If you are unable to join the live call, a replay will be available on our website at www.ceragon.com within 24 hours after the call. About Ceragon Ceragon (NASDAQ: CRNT) is the global innovator and leading solutions provider of end-to-end wireless connectivity, specializing in transport, access, and AI-powered managed & professional services. Through our commitment to excellence, we empower customers to elevate operational efficiency and enrich the quality of experience for their end users. Our customers include service providers, utilities, public safety organizations, government agencies, energy companies, and more, who rely on our wireless expertise and cutting-edge solutions for 5G & 4G broadband wireless connectivity, mission-critical services, and an array of applications that harness our ultra-high reliability and speed. Ceragon solutions are deployed by more than 600 service providers, as well as more than 1,600 private network owners, in more than 130 countries. Through our innovative, end-to-end solutions, covering hardware, software, and managed & professional services, we enable our customers to embrace the future of wireless technology with confidence, shaping the next generation of connectivity and service delivery. Ceragon delivers extremely reliable, fast to deploy, high-capacity wireless solutions for a wide range of communication network use cases, optimized to lower TCO through minimal use of spectrum, power, real estate, and labor resources - driving simple, quick, and cost-effective network modernization and positioning Ceragon as a leading solutions provider for the "connectivity everywhere" era. For more information please visit: www.ceragon.com Ceragon Networks® and FibeAir® are registered trademarks of Ceragon Networks Ltd. in the United States and other countries. CERAGON® is a trademark of Ceragon Networks Ltd., registered in various countries. Other names mentioned are owned by their respective holders. Safe Harbor This press release contains statements that constitute "forward-looking statements" within the meaning of the Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended, and the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs, expectations and assumptions of Ceragon's management about Ceragon's business, financial condition, results of operations, micro and macro market trends and other issues addressed or reflected therein. Examples of forward-looking statements include, but are not limited to, statements regarding: projections of demand, revenues, net income, gross margin, capital expenditures and liquidity, competitive pressures, order timing, supply chain and shipping, components availability, growth prospects, product development, financial resources, cost savings and other financial and market matters. You may identify these and other forward-looking statements by the use of words such as "may", "plans", "anticipates", "believes", "estimates", "targets", "expects", "intends", "potential" or the negative of such terms, or other comparable terminology, although not all forward-looking statements contain these identifying words. Although we believe that the 1projections reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that our expectations will be obtained or that any deviations therefrom will not be material. Such forward-looking statements involve known and unknown risks and uncertainties that may cause Ceragon's future results or performance to differ materially from those anticipated, expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: the effects of the evolving nature of the war situation in Israel and the related evolving regional conflicts; the effects of global economic trends, including recession, rising inflation, rising interest rates, commodity price increases and fluctuations, commodity shortages and exposure to economic slowdown; risks associated with the recent acquisition of End 2 End Technologies; risks associated with delays in the transition to 5G technologies and in the 5G rollout; risks relating to the concentration of our business on a limited number of large mobile operators and the fact that the significant weight of their ordering, compared to the overall ordering by other customers, coupled with inconsistent ordering patterns, could negatively affect us; risks resulting from the volatility in our revenues, margins and working capital needs; disagreements with tax authorities regarding tax positions that we have taken could result in increased tax liabilities; the high volatility in the supply needs of our customers, which from time to time lead to delivery issues and may lead to us being unable to timely fulfil our customer commitments; and such other risks, uncertainties and other factors that could affect our results of operation, as further detailed in Ceragon's most recent Annual Report on Form 20-F, as published on March 21, 2024, as well as other documents that may be subsequently filed by Ceragon from time to time with the Securities and Exchange Commission. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Ceragon does not assume any obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release unless required by law. While we believe that we have a reasonable basis for each forward-looking statement contained in this press release, we caution you that these statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. In addition, any forward-looking statements represent Ceragon's views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. Ceragon does not assume any obligation to update any forward-looking statements unless required by law. The results reported in this press-release are preliminary and unaudited results, and investors should be aware of possible discrepancies between these results and the audited results to be reported, due to various factors. Ceragon's public filings are available on the Securities and Exchange Commission's website at www.sec.gov and may also be obtained from Ceragon's website at www.ceragon.com. Logo: https://mma.prnewswire.com/media/1704355/Ceragon_Networks_Ltd_Logo.jpg Ceragon Investor & Media Contact: Rob FinkFNK IRTel.: +1-646-809-4048[email protected] CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. dollars in thousands, except share and per share data) Three months ended Year ended December 31, December 31, 2024 2023 2024 2023 Revenues 106,932 90,359 394,190 347,179 Cost of revenues 70,550 59,296 257,339 227,310 Gross profit 36,382 31,063 136,851 119,869 Operating expenses: Research and development, net 8,969 9,070 34,951 32,274 Sales and Marketing 11,077 10,544 44,717 40,577 General and administrative 5,374 6,445 14,220 23,793 Restructuring and related charges - - 1,416 897 Acquisition- and integration-related charges 283 835 1,660 1,118 Other operating expenses 1,160 - 1,160 - Total operating expenses 26,863 26,894 98,124 98,659 Operating income 9,519 4,169 38,727 21,210 Financial expenses and others, net 4,863 3,402 11,474 8,468 Income before taxes 4,656 767 27,253 12,742 Taxes on income 1,046 1,970 3,190 6,522 Net income (loss) 3,610 (1,203) 24,063 6,220 Basic net income (loss) per share 0.04 (0.01) 0.28 0.07 Diluted net income (loss) per share 0.04 (0.01) 0.27 0.07 Weighted average number of shares used in computing basic net income (loss) per share 87,207,634 85,054,173 86,191,178 84,617,774 Weighted average number of shares used in computing diluted net income (loss) per share 89,987,560 85,054,173 88,460,001 85,482,626 CONDENSED CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands) December 31, December 31, 2024 2023 ASSETS CURRENT ASSETS: Cash and cash equivalents 35,311 28,237 Trade receivables, net 149,619 104,321 Inventories 59,693 68,811 Other accounts receivable and prepaid expenses 16,415 16,571 Total current assets 261,038 217,940 NON-CURRENT ASSETS: Severance pay and pension fund 4,915 4,985 Property and equipment, net 36,764 30,659 Operating lease right-of-use assets 16,702 18,837 Intangible assets, net 16,791 16,401 Goodwill 7,749 7,749 Other non-current assets 1,037 1,954 Total non-current assets 83,958 80,585 Total assets 344,996 298,525 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Trade payables 91,157 67,032 Deferred revenues 2,573 5,507 Short-term loans 25,200 32,600 Operating lease liabilities 2,971 3,889 Other accounts payable and accrued expenses 29,547 23,925 Total current liabilities 151,448 132,953 LONG-TERM LIABILITIES: Accrued severance pay and pension 8,359 9,399 Deferred revenues - 670 Operating lease liabilities 12,936 13,716 Other long-term payables 5,928 7,768 Total long-term liabilities 27,223 31,553 SHAREHOLDERS' EQUITY: Share capital 224 224 Additional paid-in capital 447,377 437,161 Treasury shares at cost (20,091) (20,091) Other comprehensive loss (10,060) (8,087) Accumulated deficit (251,125) (275,188) Total shareholders' equity 166,325 134,019 Total liabilities and shareholders' equity 344,996 298,525 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (U.S. dollars, in thousands) Three months ended Year ended December 31, December 31, 2024 2023 2024 2023 Cash flow from operating activities: Net income (loss) 3,610 (1,203) 24,063 6,220 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 3,251 2,466 12,112 9,967 Loss from sale of property and equipment, net 38 - 207 61 Stock-based compensation expense 921 938 4,298 3,964 Decrease (increase) in accrued severance pay and pensions, net (239) 88 (970) (267) Decrease (increase) in trade receivables, net (28,437) 1,856 (46,224) (2,370) Decrease in other assets (including other accounts receivable, prepaid expenses, other non-current assets, and the effect of exchange rate changes on cash and cash equivalents) 3,656 15,085 1,344 16,994 Decrease (increase) in inventory (309) 4,681 7,606 6,303 Decrease in operating lease right-of-use assets 939 794 4,632 3,781 Increase (decrease) in trade payables 15,291 (1,121) 23,032 (1,847) Increase (decrease) in other accounts payable and accrued expenses (including other long-term payables) 3,549 (2,720) 3,898 1,677 Decrease in operating lease liability (689) (73) (4,196) (4,034) Decrease in deferred revenues (452) (9,830) (3,604) (9,562) Net cash provided by operating activities 1,129 10,961 26,198 30,887 Cash flow from investing activities: Purchases of property and equipment, net (3,727) (2,548) (14,581) (9,955) Software development costs capitalized (645) (661) (1,883) (2,944) Payments made in connection with business acquisitions, net of acquired cash - (7,971) - (7,971) Net cash used in investing activities (4,372) (11,180) (16,464) (20,870) Cash flow from financing activities: Proceeds from exercise of stock options 5,071 9 5,878 39 Repayments of bank credits and loans, net - (5,600) (7,400) (4,900) Net cash provided by (used in) financing activities 5,071 (5,591) (1,522) (4,861) Effect of exchange rate changes on cash and cash equivalents (531) 81 (1,138) 133 Increase (decrease) in cash and cash equivalents 1,297 (5,729) 7,074 5,289 Cash and cash equivalents at the beginning of the period 34,014 33,966 28,237 22,948 Cash and cash equivalents at the end of the period 35,311 28,237 35,311 28,237 RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS (U.S. dollars in thousands, except share and per share data) Three months ended December 31, Year ended December 31, 2024 2023 2024 2023 GAAP Cost of revenues 70,550 59,296 257,339 227,310 Stock-based compensation expenses (121) (115) (495) (485) Amortization of acquired intangible assets (189) (57) (756) (57) Excess cost on acquired inventory in business combination (*) - (525) (124) (525) Non-GAAP Cost of revenues 70,240 58,599 255,964 226,243 GAAP Gross profit 36,382 31,063 136,851 119,869 Stock-based compensation expenses 121 115 495 485 Amortization of acquired intangible assets 189 57 756 57 Excess cost on acquired inventory in business combination (*) - 525 124 525 Non-GAAP Gross profit 36,692 31,760 138,226 120,936 GAAP Research and development expenses 8,969 9,070 34,951 32,274 Stock-based compensation expenses (192) (156) (701) (828) Loss from termination of joint development agreement - (1,199) - (1,199) Non-GAAP Research and development expenses 8,777 7,715 34,250 30,247 GAAP Sales and marketing expenses 11,077 10,544 44,717 40,577 Stock-based compensation expenses (332) (320) (1,356) (1,416) Amortization of acquired intangible assets (117) (49) (622) (49) Non-GAAP Sales and marketing expenses 10,628 10,175 42,739 39,112 GAAP General and administrative expenses 5,374 6,445 14,220 23,793 Stock-based compensation expenses (276) (347) (1,746) (1,238) Non-GAAP General and administrative expenses 5,098 6,098 12,474 22,555 GAAP Restructuring and related charges - - 1,416 897 Restructuring and related charges - - (1,416) (897) Non-GAAP Restructuring and related charges - - - - GAAP Acquisition- and integration-related charges 283 835 1,660 1,118 Acquisition- and integration-related charges (283) (835) (1,660) (1,118) Non-GAAP Acquisition- and integration-related charges - - - - GAAP Other operating expenses 1,160 - 1,160 - Other operating expenses (1,160) - (1,160) - Non-GAAP other operating expenses - - - - RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS (U.S. dollars in thousands, except share and per share data) Three months ended Year ended December 31, December 31, 2024 2023 2024 2023 GAAP Operating income 9,519 4,169 38,727 21,210 Stock-based compensation expenses 921 938 4,298 3,967 Amortization of acquired intangible assets 306 106 1,378 106 Excess cost on acquired inventory in business combination (*) - 525 124 525 Loss from termination of joint development agreement - 1,199 - 1,199 Restructuring and other charges - - 1,416 897 Acquisition- and integration-related charges 283 835 1,660 1,118 Other operating expenses 1,160 - 1,160 - Non-GAAP Operating income 12,189 7,772 48,763 29,022 GAAP Financial expenses and others, net 4,863 3,402 11,474 8,468 Leases – financial income (expenses) 15 (754) (167) 253 Non-cash revaluation expenses associated with business combination (1,385) (110) (1,703) (110) Non-GAAP Financial expenses and others, net 3,493 2,538 9,604 8,611 GAAP Tax expenses 1,046 1,970 3,190 6,522 Non-cash tax adjustments - (478) (413) (2,851) Non-GAAP Tax expenses 1,046 1,492 2,777 3,671 GAAP Net income (loss) 3,610 (1,203) 24,063 6,220 Stock-based compensation expenses 921 938 4,298 3,967 Amortization of acquired intangible assets 306 106 1,378 106 Excess cost on acquired inventory in business combination (*) - 525 124 525 Loss from termination of joint development agreement - 1,199 - 1,199 Restructuring and other charges - - 1,416 897 Acquisition- and integration-related charges 283 835 1,660 1,118 Other operating expenses 1,160 - 1,160 - Leases – financial expenses (income) (15) 754 167 (253) Non-cash revaluation expenses associated with business combination 1,385 110 1,703 110 Non-cash tax adjustments - 478 413 2,851 Non-GAAP Net income 7,650 3,742 36,382 16,740 GAAP Basic net income (loss) per share 0.04 (0.01) 0.28 0.07 GAAP Diluted net income (loss) per share 0.04 (0.01) 0.27 0.07 Non-GAAP Diluted net income per share (**) 0.09 0.04 0.41 0.20 (*) Consists of charges to cost of revenues for the difference between the fair value of acquired inventory in business combination, which was recorded at fair value, and the actual cost of this inventory, which impacts the Company's gross profit. (**) Weighted average number of shares used in computing diluted net income per share is the same as in GAAP SOURCE Ceragon Networks Ltd. WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

Ceragon Reports 18.3% Increase in Quarterly Revenue, GAAP EPS of $0.04 Per Share in the Fourth Quarter

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