DZS INC Reports FY2022 Q4 Earnings Results on February 16 2023.
March 20, 2023
Earnings Overview
On February 16 2023, DZS INC ($NASDAQ:DZSI) reported their earnings results for FY2022 Q4, ending on December 31 2022. Revenue for the fourth quarter was reported as USD -14.6 million – a decrease of 538.6% from the same period the year prior. Net income for the quarter was USD 100.2 million, an increase of 2.2% year-on-year.
Transcripts Simplified
DZS reported $90 million in orders for the fourth quarter of 2021, resulting in a book to bill ratio of 0.9. Revenue for the quarter was $100 million, an increase of 2% year-over-year or 10% on a constant currency basis. Revenue from Americas increased 3% year-over-year and from EMEA increased 44% due to success with new customer capture. Revenue from Asia decreased 9% due to foreign currency exchange rates and COVID related lockdowns.
Adjusted gross margin of 31% was impacted by foreign currency and elevated supply chain costs. Fabrinet manufacturing transition of products that shipped into the North America and EMEA regions was completed by the end of the fourth quarter.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Dzs Inc. More…
| Total Revenues | Net Income | Net Margin |
| 375.69 | -37.43 | -9.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Dzs Inc. More…
| Operations | Investing | Financing |
| -50.9 | -28.01 | 64.77 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Dzs Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 385.01 | 242.28 | 4.61 |
Key Ratios Snapshot
Some of the financial key ratios for Dzs Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 7.0% | – | -9.0% |
| FCF Margin | ROE | ROA |
| -14.8% | -16.8% | -5.5% |
Market Price
On the day prior, DZS INC stock opened at $12.6 and closed at $12.1, marking a 4.5% decrease from its previous closing price of $12.6. The company is reporting a decrease in revenue, indicating a challenging fourth quarter for the company, but it still remains one of the largest telecom companies in the world. DZS INC has been a leader in the telecom industry for years, with its products and services being used by individuals and businesses alike. As an industry leader, it is not surprising that the company reported a decrease in revenue for the quarter.
However, the company’s management team was able to implement strategies to reduce costs and streamline operations in order to mitigate the losses. Going forward, DZS INC is taking steps to ensure that it remains competitive in the market. The company is looking to invest in new technologies and explore new revenue streams in order to increase profits and create value for stakeholders. Overall, while the fourth quarter results were disappointing for DZS INC, the company is taking proactive steps to ensure its long-term success. The results of these efforts will be seen in the next few quarters and investors are encouraged to keep an eye on the company’s performance. Live Quote…
Analysis
At GoodWhale, we recently conducted an analysis of DZS INC‘s financials. According to our Star Chart, DZS INC is strong in growth and profitability, while they are medium in asset and weak in dividend. Our Health Score of 4/10 indicates that DZS INC may be able to sustain future operations in times of crisis. Based on our analysis, we classify DZS INC as ‘rhino’, a type of company which has achieved moderate revenue or earnings growth. Given the moderate growth potential of the company, investors who are looking for long-term investments may be interested in this company. Furthermore, these investors may be attracted to the potential stability of the company, due to its Health Score. Therefore, investors who are looking for a long-term, stable investment may be interested in DZS INC. More…
Peers
The competition in the telecommunications industry is fierce. DZS Inc. is up against some of the biggest names in the business, including Extreme Networks Inc., ADVA Optical Networking SE, and Ciena Corp. Each company is striving to provide the best products and services to their customers. While DZS Inc. has a strong presence in the market, its competitors are not far behind.
– Extreme Networks Inc ($NASDAQ:EXTR)
With a market cap of $2.5 billion and a return on equity of 40.12%, Extreme Networks is a publicly traded networking company that provides software-driven networking solutions to enterprise customers. The company delivers high-performance switching, routing, and security solutions that enable customers to build agile, data-driven networks that connect their people, applications, and devices.
– ADVA Optical Networking SE ($LTS:0NOL)
ADVA Optical Networking SE has a market cap of 1.08B as of 2022, a Return on Equity of 4.24%. The company provides optical and Ethernet-based networking solutions.
– Ciena Corp ($NYSE:CIEN)
Ciena is a network specialist that provides equipment, software and services that support mission-critical applications for communications service providers, enterprises and governments worldwide. Its products and services enable its customers to drive revenue, reduce expenses and improve efficiency by delivering high-capacity, high-speed networking solutions. Ciena’s common stock is listed on the NASDAQ Global Select Market under the symbol CIEN and is included in the S&P 500 index.
ROE is return on equity and is a measure of how well a company uses investment funds to generate profits. A company with a higher ROE is using funds more effectively to generate profits. Ciena’s ROE of 6.6% indicates that it is using funds efficiently to generate profits.
Ciena’s market cap is 6.64B as of 2022. This means that the market value of Ciena’s outstanding shares is 6.64B. Ciena’s market cap is a good indicator of the company’s size and its position in the market.
Summary
Investors in DZS Inc received a surprise on February 16, 2023 when the company reported their fourth-quarter results for FY2022. Total revenue for the quarter was reported as a staggering decrease of 538.6% from the same period the year prior. Despite this, net income increased by 2.2%.
Following the announcement, the stock price fell, likely due to investor uncertainty over the company’s ability to recover from such a significant drop in revenue. Going forward, investors should consider any potential risks when investing in this company and weigh them carefully against any potential returns.
Related Posts
Recent Posts
