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Adtran Holdings, Inc.
ISIN: US00486H1059
WKN: A3C7M6
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Adtran Holdings, Inc. · ISIN: US00486H1059 · Newswire (Unternehmen)
Land: Vereinigte Staaten von Amerika · Primärmarkt: Vereinigte Staaten von Amerika · EQS NID: 1896921
07 Mai 2024 06:00AM

ADTRAN Holdings, Inc. reports first quarter 2024 financial results


EQS-News: Adtran Holdings, Inc. / Key word(s): Quarter Results
ADTRAN Holdings, Inc. reports first quarter 2024 financial results

07.05.2024 / 06:00 CET/CEST
The issuer is solely responsible for the content of this announcement.


ADTRAN Holdings, Inc. reports first quarter 2024 financial results 

  • Q1 revenue above mid-point of guidance; non-GAAP profitability in line with guidance
  • $53 million sequential improvement in GAAP operating cash flow

 Huntsville, Alabama, USA. — May 06, 2024 — ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) (“ADTRAN Holdings” or the “Company”) today announced its unaudited financial results for the first quarter of 2024.

GAAP gross margin for the first quarter was 31.9%, compared to 34.8% in Q4 2023 and 27.1% in the year-ago quarter, representing an improvement of 484 basis points (“bps”) year-over-year but a decrease of 285 bps quarter-over-quarter. The year-over-year improvement primarily resulted from lower purchasing and transportation costs, as well as lower acquisition-related expenses, amortizations and adjustments. The sequential margin decline is primarily due to $8.8 million of inventory charges related to a strategy shift as part of our Business Efficiency Program.

Non-GAAP gross margin for the first quarter was 41.6% compared to 41.9% in Q4 2023 and 37.3% in the year-ago quarter representing a decline of 33 bps sequentially and an improvement of 429 bps year-over-year. 

GAAP operating margin for the first quarter was negative 150.2%, primarily driven by a non-cash goodwill impairment charge .

Non-GAAP operating margin for the first quarter was negative 3.9%, which was within the guidance range of between -7% and 0% of revenues. Non-GAAP operating margin was negatively impacted by an unfavorable currency rate development and seasonal effects in the first quarter.

GAAP net loss attributable to the Company for the first quarter of 2024, including the above mentioned impairment charge, was $324.6 million. Diluted loss per share attributable to the Company for the first quarter was $4.12.

Non-GAAP net loss attributable to the Company for the first quarter of 2024 was $1.7 million. Non-GAAP diluted loss per share attributable to the Company for the first quarter was $0.02.

ADTRAN Holdings’ Chairman and Chief Executive Officer Tom Stanton stated, "First quarter revenue and profitability came in as expected, with the weakness still impacting our results. However, we were pleased with the continued momentum in our customer win rate which was bolstered by the ongoing expansion of our Mosaic One platform. As we continued to execute on our business efficiency program , we were able to reduce inventory and significantly improve our operating cashflow while maintaining our diligence in gaining market share during this pivotal time in our industry. We believe that as markets return to normal, our continued focus on these measures, will lead to sustainable margin expansions and shareholder value creation in the mid-term.”

The Company will hold a conference call to discuss its first quarter results on Tuesday, May 07, 2024, at 9:30 a.m. Central Time, or 4:30 p.m. Central European Summer Time. The Company will webcast this conference call. To listen, simply visit our Investor Relations site at investors.adtran.com approximately 10 minutes prior to the start of the call, click on the event “ADTRAN Holdings Releases 1st Quarter 2024 Financial Results and Earnings Call”, and click on the webcast link.

An online replay of the Company’s conference call, as well as the transcript of the Company's conference call, will be available on the Investor Relations site approximately 24 hours following the call and will remain available for at least 12 months. For more information, visit investors.adtran.com or email investor.relations@adtran.com.

Cautionary Note Regarding Forward-Looking Statements

Statements contained in this press release which are not historical facts, such as those relating to expectations regarding future revenues; ADTRAN Holdings’ expected future customer win rate and expansion of its Mosaic One platform; the ability of ADTRAN Holdings’ ability to continue to effectively implement the Business Efficiency Program; the impact of the foregoing measures on margin expansion and shareholder value creation; and ADTRAN Holdings’ strategy and outlook, outlook and financial guidance, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can also generally be identified by the use of words such as “believe,” “expect,” “intend,” “estimate,” “anticipate,” “will,” “may,” “could” and similar expressions. In addition, ADTRAN Holdings, through its senior management, may from time to time make forward-looking public statements concerning the matters described herein. All such projections and other forward-looking information speak only as of the date hereof, and ADTRAN Holdings undertakes no duty to publicly update or revise such forward-looking information, whether as a result of new information, future events, or otherwise, except to the extent as may be required by law. All such forward-looking statements are necessarily estimates and reflect management’s best judgment based upon current information. Actual events or results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors. While it is impossible to identify all such factors, factors which have caused and may in the future cause actual events or results to differ materially from those estimated by ADTRAN Holdings include, but are not limited to: (i) risks and uncertainties relating to ADTRAN Holdings’ ability to reduce expenditures and the impact of such reductions on its financial results and financial condition; (ii) the risk of fluctuations in revenue due to lengthy sales and approval processes required by major and other service providers for new products, as well as ongoing tighter inventory management of ADTRAN Holdings’ customers ; (iii) risks and uncertainties relating to the recent restatements of our previously issued consolidated financial statements and ongoing material weaknesses in our internal control over financial reporting; (iv) our ability to comply with the covenants set forth in our credit facility; (v) risks posed by potential breaches of information systems and cyber-attacks; (vi) the risk that ADTRAN Holdings may not be able to effectively compete, including through product improvements and development; and (vii) other risks set forth in ADTRAN Holdings’ public filings made with the Securities and Exchange Commission (“SEC”), including its Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 15, 2024,  and risks to be disclosed in its Form 10-Q for the quarterly period ended March 31, 2024.

 Explanation of Use of Non-GAAP Financial Measures

 Set forth in the tables below are reconciliations of gross profit, gross margin, operating expenses, operating loss, other expense, net loss inclusive of the non-controlling interest, net loss attributable to the Company, net income (loss) attributable to the non-controlling interest, and loss per share - basic and diluted, attributable to the Company, in each case as reported based on generally accepted accounting principles in the United States (“GAAP”), to non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP other expense, non-GAAP net loss inclusive of the non-controlling interest, non-GAAP net loss attributable to the Company, non-GAAP net income attributable to the non-controlling interest, non-GAAP loss per share - basic and diluted, attributable to the Company, respectively, and non-GAAP free cash flow. Such non-GAAP measures exclude acquisition related expenses, amortization and adjustments (consisting of intangible amortization of backlog, developed technology, customer relationships, and trade names acquired in connection with business combinations and amortization of inventory fair value adjustments), stock-based compensation expense, amortization of pension actuarial losses, deferred compensation adjustments, integration expenses, restructuring expenses,  goodwill impairments, and the tax effect of these adjustments to net income. These measures are used by management in our ongoing planning and annual budgeting processes. Additionally, we believe the presentation of these non-GAAP measures when combined with the presentation of the most directly comparable GAAP financial measure, is beneficial to the overall understanding of ongoing operating performance of the Company.

These  non-GAAP financial measures are not prepared in accordance with, or an alternative for, GAAP and therefore should not be considered in isolation or as a substitution for analysis of our results as reported under GAAP. Additionally, our calculation of non-GAAP measures may not be comparable to similar measures calculated by other companies.

About Adtran

ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) is the parent company of Adtran, Inc., a leading global provider of open, disaggregated networking and communications solutions that enable voice, data, video and internet communications across any network infrastructure. From the cloud edge to the subscriber edge, Adtran empowers communications service providers around the world to manage and scale services that connect people, places and things. Adtran solutions are used by service providers, private enterprises, government organizations and millions of individual users worldwide. ADTRAN Holdings, Inc. is also the largest shareholder of Adtran Networks SE, formerly ADVA Optical Networking SE. Find more at Adtran, LinkedIn and Twitter.

Published by

ADTRAN Holdings, Inc.

www.adtran.com

For media

Gareth Spence

+44 1904 699 358

public.relations@adtran.com

For investors

Steven Williams

+49 89 890 665 918

investor@adtran.com

 

 

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands)

  March 31,     December  31,  
  2024     2023  
Assets          
Current Assets          
Cash and cash equivalents $ 106,757     $ 87,167  
Accounts receivable, net   187,554       216,445  
Other receivables   12,116       17,450  
Income tax receivable   8,717       7,933  
Inventory, net   322,147       362,295  
Prepaid expenses and other current assets   59,667       45,566  
Total Current Assets   696,958       736,856  
Property, plant and equipment, net   126,969       123,020  
Deferred tax assets   25,421       25,787  
Goodwill   55,129       353,415  
Intangibles, net   306,448       327,985  
Other non-current assets   87,729       87,706  
Long-term investments   29,252       27,743  
Total Assets $ 1,327,906     $ 1,682,512  
           
Liabilities, Redeemable Non-Controlling Interest and Equity          
Current Liabilities          
Accounts payable $ 159,083     $ 162,922  
Unearned revenue   55,124       46,731  
Accrued expenses and other liabilities   36,404       37,607  
Accrued wages and benefits   25,869       27,030  
Income tax payable, net   6,266       5,221  
Total Current Liabilities   282,746       279,511  
Non-current revolving credit agreement outstanding   195,000       195,000  
Deferred tax liabilities   15,414       35,655  
Non-current unearned revenue   22,884       25,109  
Non-current pension liability   11,692       12,543  
Deferred compensation liability   29,709       29,039  
Non-current lease obligations   27,668       31,420  
Other non-current liabilities   35,375       28,657  
Total Liabilities   620,488       636,934  
Redeemable Non-Controlling Interest   441,635       451,756  
Equity          
Common stock   791       790  
Additional paid-in capital   798,897       795,304  
Accumulated other comprehensive income   29,656       47,461  
Retained deficit   (558,363 )     (243,908 )
Treasury stock   (5,198 )     (5,825 )
Total Equity   265,783       593,822  
Total Liabilities, Redeemable Non-Controlling Interest and Equity $ 1,327,906     $ 1,682,512  

 

 

Condensed Consolidated Statements of Loss

(Unaudited)

(In thousands, except per share amounts)

 

    Three Months Ended    
    March 31,    
    2024     2023    
Revenue              
Network Solutions   $ 181,273     $ 282,418    
Services & Support     44,900       41,494    
Total Revenue     226,173       323,912    
Cost of Revenue              
Network Solutions     126,326       219,130    
Network Solutions - inventory write-down     8,782          
Services & Support     18,810       16,974    
Total Cost of Revenue     153,918       236,104    
Gross Profit     72,255       87,808    
Selling, general and administrative expenses     59,100       67,397    
Research and development expenses     60,251       70,143    
Goodwill impairment     292,583          
Operating Loss     (339,679 )     (49,732 )  
Interest and dividend income     397       304    
Interest expense     (4,598 )     (3,287 )  
Net investment gain     2,253       1,252    
Other income (expense), net     1,310       (303 )  
Loss Before Income Taxes     (340,317 )     (51,766 )  
Income tax benefit     18,647       11,313    
Net Loss   $ (321,670 )   $ (40,453 )  
Less: Net Income (Loss) attributable to non-controlling interest     2,880       (370 )  
Net Loss attributable to ADTRAN Holdings, Inc.   $ (324,550 )   $ (40,083 )  
               
Weighted average shares outstanding – basic     78,814       78,358    
Weighted average shares outstanding – diluted     78,814       78,358    
               
Loss per common share attributable to ADTRAN Holdings, Inc. – basic   $ (4.12 )   $ (0.51 )  
Loss per common share attributable to ADTRAN Holdings, Inc. – diluted   $ (4.12 )   $ (0.51 )  

 

 

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

 

    Three Months Ended  
    March 31,  
    2024     2023  
Cash flows from operating activities:            
Net loss   $ (321,670 )   $ (40,453 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:            
Depreciation and amortization     22,528       33,402  
Goodwill impairment     292,583        
Amortization of debt issuance cost     1,013       146  
Gain on investments, net     (2,621 )     (3,154 )
Net loss on disposal of property, plant and equipment     150        
Stock-based compensation expense     3,957       3,812  
Deferred income taxes     (19,738 )     (24,019 )
Other, net     545       (1 )
Inventory write down     8,782        
Inventory reserves     (17,247 )     16,051  
Changes in operating assets and liabilities:            
Accounts receivable, net     26,002       17,658  
Other receivables     5,606       1,980  
Income taxes receivable, net     (1,296 )      
Inventory     49,514       (2,764 )
Prepaid expenses, other current assets and other assets     (15,888 )     1,118  
Accounts payable     (4,236 )     (40,367 )
Accrued expenses and other liabilities     7,459       6,349  
Income taxes payable, net     1,155       10,316  
Net cash provided by (used in) operating activities     36,598       (19,926 )
             
Cash flows from investing activities:            
Purchases of property, plant and equipment     (13,374 )     (8,439 )
Proceeds from sales and maturities of available-for-sale investments     873       930  
Purchases of available-for-sale investments     (44 )     (516 )
Proceeds from beneficial interests in securitized accounts receivable           1,231  
Net cash used in investing activities     (12,545 )     (6,794 )
             
Cash flows from financing activities:            
Tax withholdings related to stock-based compensation settlements     (176 )     (6,258 )
Proceeds from stock option exercises     219       58  
Dividend payments           (7,076 )
Proceeds from receivables purchase agreement     30,231        
Repayments on receivables purchase agreement     (32,437 )      
Proceeds from draw on revolving credit agreements           138,236  
Repayment of revolving credit agreements           (43,464 )
Payment of redemption of redeemable non-controlling interest     (5 )     (1,176 )
Payment of debt issuance cost     (1,994 )      
Repayment of notes payable           (24,692 )
Net cash (used in) provided by financing activities     (4,162 )     55,628  
             
Net increase in cash and cash equivalents     19,891       28,908  
Effect of exchange rate changes     (301 )     (1,095 )
Cash and cash equivalents, beginning of period     87,167       108,644  
Cash and cash equivalents, end of period   $ 106,757     $ 136,457  
             
Supplemental disclosure of cash financing activities:            
Cash paid for interest   $ 5,243     $ 1,610  
Cash paid for income taxes   $ 2,315     $ 1,251  
Cash used in operating activities related to operating leases   $ 2,384     $ 4,057  
Supplemental disclosure of non-cash investing activities:            
Right-of-use assets obtained in exchange for lease obligations   $ 842     $ 486  
Purchases of property, plant and equipment included in accounts payable   $ 1,689     $ 4,354  

 

Supplemental Information

Reconciliation of Gross Profit and Gross Margin to

Non-GAAP Gross Profit and Non-GAAP Gross Margin

(Unaudited)

(In thousands)

 

    Three Months Ended  
    March 31,
2024
    December 31, 2023     March 31,
2023
 
Total Revenue   $ 226,173     $ 225,479     $ 323,912  
                   
Cost of Revenue   $ 153,918     $ 147,014     $ 236,104  
Acquisition-related expenses, amortizations and adjustments(1)     (10,177 )     (10,048 )     (32,578 )
Stock-based compensation expense     (275 )     (440 )     (240 )
Restructuring expenses(2)     (11,247 )     (5,517 )     (76 )
Integration expenses(3)     (35 )     39        
Non-GAAP Cost of Revenue   $ 132,184     $ 131,048     $ 203,210  
                   
Gross Profit   $ 72,255     $ 78,465     $ 87,808  
Non-GAAP Gross Profit   $ 93,989     $ 94,431     $ 120,702  
                   
Gross Margin     31.9 %     34.8 %     27.1 %
Non-GAAP Gross Margin     41.6 %     41.9 %     37.3 %

 

(1)  Includes intangible amortization of backlog, inventory fair value adjustments, developed technology, customer relationships, and trade names acquired in connection with business combinations.

(2)  Includes expenses for restructuring program designed to optimize the assets and business processes following the business combination with Adtran Networks SE. These expenses include inventory write down and other charges of $8.8M incurred as a result of a strategic shift in certain product lines in connection with the restructuring program. The restructuring program commenced upon the closing of the business combination with Adtran Networks SE and is expected to be substantially completed in late 2024.

(3) Includes expenses related to the Company's one-time integration bonus program in connection with synergy targets as a result of the business combination with Adtran Networks SE.

Supplemental Information

Reconciliation of Operating Expenses to Non-GAAP Operating Expenses

(Unaudited)

(In thousands)

 

    Three Months Ended    
    March 31,     December 31,     March 31,    
    2024     2023     2023    
Operating Expenses   $ 411,934     $ 116,080     $ 137,540    
Acquisition-related expenses, amortizations and adjustments     (4,881 ) (1)   (4,150 ) (7)   (4,584 ) (11)
Stock-based compensation expense     (3,447 ) (2)   (3,181 ) (8)   (3,458 ) (12)
Restructuring expenses     (5,862 ) (3)   (7,859 ) (9)   (2,361 ) (13)
Integration expenses     (480 ) (4)   (1,928 ) (10)   (849 ) (14)
Deferred compensation adjustments(5)     (1,940 )     (1,324 )     (394 )  
Goodwill impairment     (292,583 ) (6)            
Non-GAAP Operating Expenses   $ 102,741     $ 97,638     $ 125,894    

 

(1)  Includes intangible amortization of developed technology, customer relationships, and trade names acquired in connection with business combinations, of which $4.4 million is included in selling, general and administrative expenses and $0.5 million is included in research and development expenses on the condensed consolidated statements of loss.

(2) $2.5 million is included in selling, general and administrative expenses and $1.0 million is included in research and development expenses on the condensed consolidated statements of loss. 

(3) $1.8 million is included in selling, general and administrative expenses and $4.1 million is included in research and development expenses on the condensed consolidated statements of loss.

(4) $0.5 million is included in selling, general and administrative expenses and $0.02 million is included in research and development expenses on the condensed consolidated statements of loss. Includes legal and advisory fees totaling $0.1 million related primarily to the DPLTA proceedings that are recorded in selling, general and administrative expenses. Includes expenses totaling $0.4 million related to the Company's one-time integration bonus program in connection with synergy targets as a result of the business combination with Adtran Networks SE of which $0.4 million are included in selling, general and administrative expenses and $0.02 million are included in research and development expenses. The transformation bonus expense of $0.4 million includes $0.2 million of stock compensation expense.

(5) Includes non-cash change in fair value of equity investments held in the ADTRAN Holdings, Inc. Deferred Compensation Program for Employees, all of which is included in selling, general and administrative expenses on the condensed consolidated statement of loss.

(6) Non-cash impairment of goodwill in our Network Solutions reporting unit, necessitated by factors such as a decrease in the Company’s market capitalization, cautious service provider spending due to economic uncertainty and continued customer inventory adjustments.

(7)   Includes intangible amortization of developed technology, customer relationships, and trade names acquired in connection with business combinations, of which $3.7 million is included in selling, general and administrative expenses and $0.5 million is included in research and development expenses on the condensed consolidated statements of loss.

(8) $2.3 million is included in selling, general and administrative expenses and $0.9 million is included in research and development expenses on the condensed consolidated statements of loss. 

(9) $4.6 million is included in selling, general and administrative expenses and $3.2 million is included in research and development expenses on the condensed consolidated statements of loss.

(10) $1.9 million is included in selling, general and administrative expenses and $0.02 million is included in research and development expenses on the condensed consolidated statements of loss. Includes legal and advisory fees totaling $1.2 million related to a contemplated capital raise transaction that are recorded in selling, general and administrative expenses. Includes expenses totaling $0.4 million related to the Company's one-time integration bonus program in connection with synergy targets as a result of the business combination with Adtran Networks SE of which $0.4 million are included in selling, general and administrative expenses and $0.02 million are included in research and development expenses. The integration bonus expense of $0.4 million includes $0.2 million of stock compensation expense. Additionally, includes fees relating to the expansion of internal controls at Adtran Networks SE and the implementation of the DPLTA. 

(11)  Includes intangible amortization of backlog, inventory fair value adjustments, developed technology, customer relationships, and trade names acquired in connection with business combinations, of which $4.1 million is included in selling, general and administrative expenses and $0.5 million is included in research and development expenses on the condensed consolidated statements of loss.

(12) $2.5 million is included in selling, general and administrative expenses and $1.0 million is included in research and development expenses on the condensed consolidated statements of loss.

(13) $2.2 million is included in selling, general and administrative expenses and $0.2 million is included in research and development expenses on the condensed consolidated statements of loss. 

(14) $0.8 million is included in selling, general and administrative expenses on the condensed consolidated statements of loss. Includes fees relating to the expansion of internal controls at ADTRAN Networks SE and the implementation of the DPLTA.

Supplemental Information

Reconciliation of Operating Loss to Non-GAAP Operating Loss

(Unaudited)

(In thousands)

 

    Three Months Ended    
    March 31,     December 31,     March 31,    
    2024     2023     2023    
Operating Loss   $ (339,679 )   $ (37,615 )   $ (49,732 )  
Acquisition related expenses, amortizations and adjustments(1)     15,058       14,198       37,162    
Stock-based compensation expense     3,722       3,621       3,698    
Restructuring expenses(2)     17,110       13,376       2,437    
Integration expenses(3)     514       1,890       849    
Deferred compensation adjustments(4)     1,940       1,324       394    
Goodwill impairment(5)     292,583                
Non-GAAP Operating Loss   $ (8,752 )   $ (3,206 )   $ (5,192 )  

 

(1)  Includes intangible amortization of backlog, inventory fair value adjustments, developed technology, customer relationships, and trade names acquired in connection with business combinations.

(2)  Includes expenses for restructuring program designed to optimize the assets and business processes following the business combination with Adtran Networks SE. These expenses include inventory write down and other charges of $8.8M incurred as a result of a strategic shift in certain product lines in connection with the restructuring program. The restructuring program commenced upon the closing of the business combination with Adtran Networks SE and is expected to be completed in late 2024.

(3)  Includes expenses related to the Company's one-time integration bonus program in connection with synergy targets as a results of the business combination with Adtran Networks SE. Additionally, includes legal and advisory fees relating to a contemplated capital raise transactions as part of the integration. Includes fees incurred for the expansion of internal controls at Adtran Networks SE and the implementation of the DPTLA.

(4) Includes non-cash change in fair value of equity investments held in the ADTRAN Holdings, Inc. Deferred Compensation Program for Employees, all of which is included in selling, general and administrative expenses on the condensed consolidated statement of loss.

(5) Non-cash impairment of goodwill in our Network Solutions reporting unit, necessitated by factors such as a decrease in the Company’s market capitalization, cautious service provider spending due to economic uncertainty and continued customer inventory adjustments.

Supplemental Information

Reconciliation of Other Expense to Non-GAAP Other Expense

(Unaudited)

(In thousands)

 

    Three Months Ended    
    March 31, 2024     December 31, 2023     March 31, 2023    
Interest and dividend income   $ 397     $ 1,157     $ 304    
Interest expense     (4,598 )     (4,441 )     (3,287 )  
Net investment gain     2,253       1,683       1,252    
Other income (expense), net     1,310       (3,448 )     (303 )  
Total Other Expense   $ (638 )   $ (5,049 )   $ (2,034 )  
Deferred compensation adjustments (1)     (2,439 )     (1,590 )     (1,250 )  
Pension expense (2)     7       6       7    
Non-GAAP Other Expense   $ (3,070 )   $ (6,633 )   $ (3,277 )  

 

(1) Includes non-cash change in fair value of equity investments held in the ADTRAN Holdings, Inc. Deferred Compensation Program for Employees.

(2) Includes amortization of actuarial losses related to the Company's pension plan for employees in certain foreign countries

 

Supplemental Information

Reconciliation of Net Loss inclusive of Non-Controlling Interest to

Non-GAAP Net Loss inclusive of Non-Controlling Interest

(Unaudited)

 and

 Reconciliation of Net Income (Loss) attributable to Non-Controlling Interest to

Non-GAAP Net Income attributable to Non-Controlling Interest

(Unaudited)

 and

 Reconciliation of  Net Loss attributable to ADTRAN Holdings, Inc. and

 Loss per Common Share attributable to ADTRAN Holdings, Inc. – Basic and Diluted to

 Non-GAAP Net Loss attributable to ADTRAN Holdings, Inc. and

Non-GAAP Loss per Common Share attributable to ADTRAN Holdings, Inc. – Basic and Diluted

(Unaudited)

(In thousands, except per share amounts)

 

    Three Months Ended    
    March 31,
2024
    December 31,
2023
    March 31,
2023
   
Net Loss attributable to ADTRAN Holdings, Inc.   $ (324,550 )   $ (109,945 )   $ (40,083 )  
Plus: Net Income (Loss) attributable to non-controlling interest (1)     2,880       2,919       (370 )  
Net Loss inclusive of non-controlling interest   $ (321,670 )   $ (107,026 )   $ (40,453 )  
Acquisition related expenses, amortizations and adjustments     15,058       14,198       37,162    
Stock-based compensation expense     3,722       3,621       3,698    
Deferred compensation adjustments (2)     (499 )     (267 )     (856 )  
Pension adjustments (3)     7       6       7    
Restructuring expenses     17,110       13,376       2,437    
Integration expenses     514       1,890       849    
Goodwill impairment     292,583                
Tax effect of adjustments to net loss     (5,614 )     (8,735 )     (12,307 )  
Non-GAAP Net Loss inclusive of non-controlling interest   $ 1,211     $ (82,937 )   $ (9,463 )  
Less: Non-GAAP Net Income attributable to non-controlling interest (1)     2,880       2,919       1,159    
Non-GAAP Net Loss attributable to ADTRAN Holdings, Inc.   $ (1,669 )   $ (85,856 )   $ (10,622 )  
                     
GAAP Net Income (Loss) attributable to non-controlling interest (1)   $ 2,880     $ 2,919     $ (370 )  
Acquisition related expenses, amortizations and adjustments                 1,457    
Restructuring expenses                 29    
Integration expenses                 6    
Stock-based compensation expense                 37    
Non-GAAP Net Income attributable to non-controlling interest (1)   $ 2,880     $ 2,919     $ 1,159    
                     
Weighted average shares outstanding – basic     78,814       78,530       78,358    
Weighted average shares outstanding – diluted     78,814       78,530       78,358    
                     
Loss per common share attributable to ADTRAN Holdings, Inc. – basic   $ (4.12 )   $ (1.40 )   $ (0.51 )  
Loss per common share attributable to ADTRAN Holdings, Inc. – diluted   $ (4.12 )   $ (1.40 )   $ (0.51 )  
                     
Non-GAAP Loss per common share attributable to ADTRAN – basic   $ (0.02 )   $ (1.09 )   $ (0.14 )  
Non-GAAP Loss per common share attributable to ADTRAN – diluted   $ (0.02 )   $ (1.09 )   $ (0.14 )  

 

 

(1) Represents the non-controlling interest portion of the Company's ownership of Adtran Networks SE pre-DPLTA and the annual recurring compensation earned by redeemable non-controlling interests and accrued by the Company post-DPLTA.

(2) Includes non-cash change in fair value of equity investments held in deferred compensation plans offered to certain employees.

(3) Includes amortization of actuarial losses related to the Company's pension plan for employees in certain foreign countries.

  

Supplemental Information

Reconciliation of Net Cash Provided By (Used In) Operating Activities to Free Cash Flow

(Unaudited)

(In thousands)

 

    Three Months Ended  
    March 31,     December 31,     March 31,  
    2024     2023     2023  
Net Cash provided by (used in) operating activities   $ 36,598     $ (16,290 )   $ (19,926 )
Purchases of property, plant and equipment     (13,374 )     (9,447 )     (8,439 )
Free cash flow   $ 23,224     $ (25,737 )   $ (28,365 )

 



07.05.2024 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG.
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Language: English
Company: Adtran Holdings, Inc.
901 Explorer Boulevard
35806 Huntsville
United States
Internet: www.adtran.com
ISIN: US00486H1059
WKN: 892015
Indices: SDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Munich, Stuttgart; Nasdaq
EQS News ID: 1896921

 
End of News EQS News Service

1896921  07.05.2024 CET/CEST

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