Significant profitability improvement with
>700 bps increase in Gross Margin
Selected by Verizon for multi-year Advanced
Voice Network Platform
PLANO,
Texas, April 24, 2024 /PRNewswire/ -- Ribbon
Communications Inc. (Nasdaq: RBBN), a global provider of real
time communications technology and IP optical networking solutions
to many of the world's largest service providers, enterprises, and
critical infrastructure operators to modernize and protect their
networks, today announced its financial results for the first
quarter 2024.
Revenue for the first quarter of 2024 was $180 million, compared to $186 million for the first quarter of 2023. First
quarter 2024 GAAP Loss from Operations improved $22 million year over year, and Non-GAAP Adjusted
EBITDA improved $14 million to
$12 million. GAAP and Non-GAAP Gross
Margin improved over 700 basis points year over year.
"I am very pleased with the improvement in our profitability
year over year, exceeding the high end of our guidance. Sales in
the EMEA region were strong across Service Provider and Critical
Infrastructure markets, growing 24% year over year," stated
Bruce McClelland, President and
Chief Executive Officer of Ribbon Communications.
"Sales in our IP Optical Networks segment increased year over
year for the seventh consecutive quarter, up 9% over the previous
year. Lower product costs and strong regional mix contributed to
the gross margin being above 40% for the segment once again,"
Mr. McClelland added. "While Cloud & Edge sales were down
in the first quarter, we believe we have reached a low point in
U.S. Tier One Service Provider spending. We expect the new
multi-year Verizon Network Modernization program announced today,
recovery in broader Service Provider spending, and continued growth
in Enterprise, including new U.S. Federal projects, to return our
Cloud & Edge segment to growth."
Financial
Highlights1
|
|
|
|
Three months
ended
|
|
|
March
31,
|
In millions,
except per share amounts
|
|
2024
|
|
2023
|
GAAP Revenue
|
|
$
180
|
|
$
186
|
GAAP Net income
(loss)
|
|
$
(30)
|
|
$
(38)
|
Non-GAAP Net income
(loss)
|
|
$
(1)
|
|
$
(3)
|
Non-GAAP Adjusted
EBITDA
|
|
$
12
|
|
$
(2)
|
GAAP diluted earnings
(loss) per share
|
|
$
(0.18)
|
|
$
(0.23)
|
Non-GAAP diluted
earnings (loss) per share
|
|
$
(0.01)
|
|
$
(0.02)
|
Weighted average shares
outstanding basic
|
|
172
|
|
169
|
Weighted average shares
outstanding diluted
|
|
175
|
|
175
|
|
1 Please see the
reconciliations of non-GAAP financial measures to the most directly
comparable GAAP measures and additional information about non-GAAP
measures in the section entitled "Discussion of Non-GAAP Financial
Measures" in the attached schedules.
|
"We now have six quarters in a row of year-over-year Adjusted
EBITDA improvement, leading to a trailing twelve- month Adjusted
EBITDA of $105 million. This resulted
in a bank leverage ratio of 2.7x, in our target range of 2x-3x. The
first quarter also delivered solid order bookings and good cash
from operations of $13 million. We
believe these results demonstrate improvement in our business as we
execute our strategy," said Mick
Lopez, Chief Financial Officer of Ribbon Communications.
Business Outlook1
For the second
quarter of 2024, the Company projects revenue of $200 million to $210
million. Non-GAAP gross margin is projected in a range of
53.5% to 54.5%. Adjusted EBITDA is projected in a range of
$20 million to $25 million.
The Company's outlook is based on current indications for its
business, which are subject to change.
1 Please see the
reconciliations of non-GAAP financial measures to the most directly
comparable GAAP measures and additional information about the
non-GAAP measures in the section entitled "Discussion of Non-GAAP
Financial Measures" in the attached schedules.
|
Upcoming Conference Schedule
- May 14-15, 2024:
19th Annual Needham Technology, Media, and Consumer
Conference
- May 22-23, 2024: B. Riley
Securities 24th Annual Institutional Investor
Conference
- May 29, 2024: 21st Annual
Craig-Hallum Institutional Investor Conference
- June 25, 2024: Northland
Growth Conference 2024
About Ribbon
Ribbon Communications (Nasdaq: RBBN) delivers communications
software, IP and optical networking solutions to service providers,
enterprises and critical infrastructure sectors globally. We engage
deeply with our customers, helping them modernize their networks
for improved competitive positioning and business outcomes in
today's smart, always-on and data-hungry world. Our innovative,
end-to-end solutions portfolio delivers unparalleled scale,
performance, and agility, including core to edge software-centric
solutions, cloud-native offers, leading-edge security and analytics
tools, along with IP and optical networking solutions for 5G and
broadband internet. We maintain a keen focus on our commitments to
Environmental, Social and Governance (ESG) matters, offering an
annual Sustainability Report to our stakeholders. To learn more
about Ribbon visit rbbn.com.
Important Information Regarding Forward-Looking
Statements
The information in this release contains
"forward-looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995, which are subject to a
number of risks and uncertainties. All statements other than
statements of historical facts contained in this release, including
without limitation statements regarding the Company's projected
financial results for the second quarter of 2024 and beyond; the
impact of the wars in Israel and
Ukraine; customer spending and
engagement and momentum; plans and objectives for future
operations, including cost reductions; capital structure changes
and plans for future product development and manufacturing and the
expected benefits therefrom, are forward-looking statements.
Without limiting the foregoing, the words "believes", "estimates",
"expects", "expectations", "intends", "may", "plans", "projects"
and other similar language, are intended to identify
forward-looking statements.
Forward-looking statements are based on the Company's current
expectations and assumptions regarding its business, the economy
and other future conditions. Because forward-looking statements
relate to the future, they are subject to inherent uncertainties,
risks and changes in circumstances that are difficult to
predict. Actual results may differ materially from those
contemplated in these forward-looking statements due to various
risks, uncertainties and other important factors, including, among
others, the effects of geopolitical instabilities and wars,
including in Israel and
Ukraine (and the impact of
sanctions and trade restrictions imposed as a result thereof);
operational disruptions at facilities located in Israel including as a result of military
call-ups of the Company's employees in Israel, closure of the offices there or the
temporary or long-term closure of contract manufacturing in the
region; the potential impact of litigation; risks related to supply
chain disruptions, including as a result of component availability;
the timing and ability to complete a refinancing of the Company's
current credit agreement; the impact of new terms and/or covenants
in agreements entered into to refinance the current credit
agreement; risks resulting from higher interests rates and
continued inflationary pressures; the impact of restructuring and
cost-containment activities; unpredictable fluctuations in
quarterly revenue and operating results; risks related to
cybersecurity and data intrusion; failure to compete successfully
against telecommunications equipment and networking companies;
failure to grow the Company's customer base or generate recurring
business from existing customers; credit risks; the timing of
customer purchasing decisions and the Company's recognition of
revenues; macroeconomic conditions, including inflation; market
acceptance of the Company's products and services; rapid
technological and market change; the ability to protect Company
intellectual property rights and obtain necessary licenses; the
ability to maintain partner, reseller, distribution and vendor
support and supply relationships; the potential for defects in the
Company's products; increases in tariffs, trade restrictions or
taxes on the Company's products; and currency fluctuations.
These factors are not intended to be an all-encompassing list of
risks and uncertainties that may affect the Company's business and
results from operations. Additional information regarding these and
other factors can be found in the Company's reports filed with the
Securities and Exchange Commission, including, without limitation,
its Form 10-K for the year ended December
31, 2023. In providing forward-looking statements, the
Company expressly disclaims any obligation to update these
statements publicly or otherwise, whether as a result of new
information, future events or otherwise, except as required by
law.
Discussion of Non-GAAP Financial Measures
The
Company's management uses several different financial measures,
both GAAP and non-GAAP, in analyzing and assessing the overall
performance of its business, making operating decisions, planning
and forecasting future periods, and determining payments under
compensation programs. The Company considers the use of non-GAAP
financial measures helpful in assessing the core performance of its
continuing operations and when planning and forecasting future
periods. The Company's annual financial plan is prepared on a
non-GAAP basis and is approved by its board of directors. In
addition, budgeting and forecasting for revenue and expenses are
conducted on a non-GAAP basis, and actual results on a non-GAAP
basis are assessed against the annual financial plan. The Company
defines continuing operations as the ongoing results of its
business adjusted for certain expenses and credits, as described
below. The Company believes that providing non-GAAP information to
investors will allow investors to view the financial results in the
way its management views them and helps investors to better
understand the Company's core financial and operating performance
and evaluate the efficacy of the methodology and information used
by its management to evaluate and measure such performance.
While the Company's management uses non-GAAP financial measures
as tools to enhance its understanding of certain aspects of the
Company's financial performance, its management does not consider
these measures to be a substitute for, or superior to, GAAP
measures. In addition, the Company's presentations of these
measures may not be comparable to similarly titled measures used by
other companies. These non-GAAP financial measures should not be
considered alternatives for, or in isolation from, the financial
information prepared and presented in accordance with GAAP.
Investors are cautioned that there are material limitations
associated with the use of non-GAAP financial measures. In
particular, many of the adjustments to the Company's financial
measures reflect the exclusion of items that are recurring and will
be reflected in its financial results for the foreseeable
future.
Stock-Based Compensation
The expense related to
stock-based awards is generally not controllable in the short-term
and can vary significantly based on the timing, size and nature of
awards granted. The Company believes that presenting non-GAAP
operating results that exclude stock-based compensation provides
investors with visibility and insight into its management's method
of analysis and its core operating performance.
Amortization of Acquired Technology (including software
licenses); Amortization of Acquired Intangible
Assets
Amortization amounts are inconsistent in frequency
and amount and are significantly impacted by the timing and size of
acquisitions. Amortization of acquired technology is reported
separately within Cost of revenue and Amortization of acquired
intangible assets is reported separately within Operating expenses.
These items are reported collectively as Amortization of acquired
intangible assets in the accompanying reconciliations of non-GAAP
and GAAP financial measures. The Company believes that excluding
non-cash amortization of these intangible assets facilitates the
comparison of its financial results to its historical operating
results and to other companies in its industry as if the acquired
intangible assets had been developed internally rather than
acquired.
Litigation Costs
In connection with a certain ongoing
contract litigation where Ribbon is defendant (as described in Note
26 to the Company's Consolidated Financial Statements included in
its Annual Report on Form 10-K for the year ended December 31, 2023), the Company has incurred
litigation costs beginning in the first quarter of 2023. These
costs are included as a component of general and administrative
expense. The Company believes that such costs are not part of its
core business or ongoing operations, are unplanned and generally
not within its control. Accordingly, the Company believes
that excluding the litigation costs related to this specific legal
matter facilitates the comparison of the Company's financial
results to its historical operating results and to other companies
in its industry.
Acquisition-, Disposal- and
Integration-Related
The Company considers certain
acquisition-, disposal- and integration-related costs to be
unrelated to the organic continuing operations of the Company and
its acquired businesses. Such costs are generally not relevant to
assessing or estimating the long-term performance of the acquired
assets. The Company excludes such acquisition-, disposal- and
integration-related costs to allow more accurate comparisons of its
financial results to its historical operations and the financial
results of less acquisitive peer companies and allows management
and investors to consider the ongoing operations of the business
both with and without such expenses.
Restructuring and Related
The Company has
recorded restructuring and related expense to streamline operations
and reduce operating costs by closing and consolidating certain
facilities and reducing its worldwide workforce. The Company
believes that excluding restructuring and related expense
facilitates the comparison of its financial results to its
historical operating results and to other companies in its
industry, as there are no future revenue streams or other benefits
associated with these costs.
Preferred Stock and Warrant Liability Issuance
Costs
The Company incurred $3.5
million of investment banking, advisory and legal fees in
its March 2023 private placement of
the Series A Preferred Stock and warrants to purchase shares of the
Company's common stock, both of which are classified by the Company
as liabilities that are marked to market each reporting period. The
Company excludes these issuance costs to allow more accurate
comparisons of its financial results to its historical operations
and the financial results of other companies in its industry, and
it allows management and investors to consider the ongoing
operations of the business both with and without such expenses.
Preferred Stock and Warrant Liability Mark-to-Market
Adjustment
The Company recorded adjustments to the fair
value of its Series A Preferred Stock and warrants to purchase
shares of the Company's common stock in Other (expense) income,
net. Both instruments issued in March
2023 in connection with the Company's private placement and
are classified as liabilities and marked to market each reporting
period. The Company excluded these gains and losses from the change
in the fair value of these liabilities because it believes that
such gains or losses were not part of its core business or ongoing
operations.
Tax Effect of Non-GAAP Adjustments
The Non-GAAP income
tax provision is presented based on an estimated tax rate applied
against forecasted annual non-GAAP income. The Non-GAAP income tax
provision assumes no available net operating losses or valuation
allowances for the U.S. because of reporting significant cumulative
non-GAAP income over the past several years. The Company is
reporting its non-GAAP quarterly income taxes by computing an
annual rate for the Company and applying that single rate (rather
than multiple rates by jurisdiction) to its consolidated quarterly
results. The Company expects that this methodology will provide a
consistent rate throughout the year and allow investors to better
understand the impact of income taxes on its results. Due to the
methodology applied to its estimated annual tax rate, the Company's
estimated tax rate on non-GAAP income will differ from its GAAP tax
rate and from its actual tax liabilities.
Adjusted EBITDA
The Company uses Adjusted EBITDA as a
supplemental measure to review and assess its performance. The
Company calculates Adjusted EBITDA by excluding from income (loss)
from operations: depreciation; stock-based compensation;
amortization of acquired intangible assets; certain litigation
costs; acquisition-, disposal- and integration-related expense; and
restructuring and related expense. In general, the Company excludes
the expenses that it considers to be non-cash and/or not a part of
its ongoing operations. The Company may exclude other items in the
future that have those characteristics. Adjusted EBITDA is a
non-GAAP financial measure that is used by the investing community
for comparative and valuation purposes. The Company discloses this
metric to support and facilitate dialogue with research analysts
and investors. Other companies may calculate Adjusted EBITDA
differently than the Company does, limiting its usefulness as a
comparative measure.
Conference Call Details:
Conference call to discuss
the Company's financial results for the first quarter ended
March 31, 2024.
Date: Wednesday, April 24,
2024
Time: 8:30 a.m. (ET)
Dial-In Information:
US/Canada: 877-407-2991
International: 201-389-0925
Instant Telephone Access: Call me™
A telephone playback of the call will be available following the
conference call until May 8, 2024 and
can be accessed by calling 877-660-6853 or 201-612-7415 for
international callers. The reservation number for the replay is
13745635.
Live (Listen-Only) Webcast:
Available via the Investor Relations website, where a replay will
also be available shortly following the conference call.
For more details on financial results, please visit
investors.ribboncommunications.com.
Investor Relations
+1 (978) 614-8050
ir@rbbn.com
Media Contact
Catherine
Berthier
+1 (646) 741-1974
cberthier@rbbn.com
RIBBON COMMUNICATIONS
INC.
Consolidated Statements of Operations
(in thousands, except percentages and per share amounts)
(unaudited)
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|
|
|
|
2024
|
|
2023
|
|
2023
|
Revenue:
|
|
|
|
|
|
|
Product
|
$
87,610
|
|
$
125,984
|
|
$
93,318
|
|
Service
|
92,054
|
|
100,417
|
|
92,841
|
|
|
Total
revenue
|
179,664
|
|
226,401
|
|
186,159
|
|
|
|
|
|
|
|
|
|
Cost of
revenue:
|
|
|
|
|
|
|
Product
|
45,794
|
|
61,183
|
|
62,063
|
|
Service
|
35,364
|
|
37,205
|
|
35,305
|
|
Amortization of
acquired technology
|
6,551
|
|
6,305
|
|
7,389
|
|
|
Total cost of
revenue
|
87,709
|
|
104,693
|
|
104,757
|
|
|
|
|
|
|
|
|
|
Gross profit
|
91,955
|
|
121,708
|
|
81,402
|
|
|
|
|
|
|
|
|
|
Gross margin
|
51.2 %
|
|
53.8 %
|
|
43.7 %
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Research and
development
|
45,763
|
|
45,351
|
|
51,304
|
|
Sales and
marketing
|
34,716
|
|
35,361
|
|
35,399
|
|
General and
administrative
|
15,191
|
|
13,686
|
|
14,045
|
|
Amortization of
acquired intangible assets
|
6,706
|
|
6,861
|
|
7,264
|
|
Acquisition-, disposal-
and integration-related
|
-
|
|
1,494
|
|
1,642
|
|
Restructuring and
related
|
3,065
|
|
2,285
|
|
6,937
|
|
|
Total operating
expenses
|
105,441
|
|
105,038
|
|
116,591
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
(13,486)
|
|
16,670
|
|
(35,189)
|
Interest expense,
net
|
(5,987)
|
|
(6,989)
|
|
(6,422)
|
Other (expense) income,
net
|
(7,513)
|
|
(3,232)
|
|
4,772
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
(26,986)
|
|
6,449
|
|
(36,839)
|
Income tax benefit
(provision)
|
(3,375)
|
|
630
|
|
(1,466)
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
(30,361)
|
|
$
7,079
|
|
$
(38,305)
|
|
|
|
|
|
|
|
|
|
Income (loss) per
share:
|
|
|
|
|
|
|
Basic
|
|
$
(0.18)
|
|
$
0.04
|
|
$
(0.23)
|
|
Diluted
|
$
(0.18)
|
|
$
0.04
|
|
$
(0.23)
|
|
|
|
|
|
|
|
|
|
Weighted average shares
used to compute income (loss) per share:
|
|
|
|
|
|
|
Basic
|
|
172,428
|
|
171,755
|
|
168,541
|
|
Diluted
|
172,428
|
|
172,990
|
|
168,541
|
|
RIBBON COMMUNICATIONS
INC.
Consolidated Balance Sheets
(in thousands)
(unaudited)
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
|
|
2024
|
|
2023
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
30,931
|
|
$
26,630
|
|
Accounts receivable,
net
|
212,498
|
|
268,421
|
|
Inventory
|
80,758
|
|
77,521
|
|
Other current
assets
|
44,943
|
|
46,146
|
|
|
Total current
assets
|
369,130
|
|
418,718
|
|
|
|
|
|
|
|
Property and equipment,
net
|
40,758
|
|
41,820
|
Intangible assets,
net
|
224,880
|
|
238,087
|
Goodwill
|
300,892
|
|
300,892
|
Deferred income
taxes
|
72,438
|
|
69,761
|
Operating lease
right-of-use assets
|
37,110
|
|
39,783
|
Other assets
|
33,252
|
|
35,092
|
|
|
|
|
$
1,078,460
|
|
$
1,144,153
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
Current
liabilities:
|
|
|
|
|
Current portion of term
debt *
|
$
228,168
|
|
$
35,102
|
|
Accounts
payable
|
66,847
|
|
85,164
|
|
Accrued expenses and
other
|
84,491
|
|
91,687
|
|
Operating lease
liabilities
|
14,213
|
|
15,739
|
|
Deferred
revenue
|
110,596
|
|
113,381
|
|
|
Total current
liabilities
|
504,315
|
|
341,073
|
|
|
|
|
|
|
|
Long-term debt, net of
current *
|
-
|
|
197,482
|
Warrant
liability
|
5,927
|
|
5,295
|
Preferred stock
liability
|
56,204
|
|
53,337
|
Operating lease
liabilities, net of current
|
36,768
|
|
38,711
|
Deferred revenue, net
of current
|
14,019
|
|
19,218
|
Deferred income
taxes
|
5,616
|
|
5,616
|
Other long-term
liabilities
|
30,953
|
|
30,658
|
|
|
|
Total
liabilities
|
653,802
|
|
691,390
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Common stock
|
17
|
|
17
|
|
Additional paid-in
capital
|
1,962,602
|
|
1,958,909
|
|
Accumulated
deficit
|
(1,550,311)
|
|
(1,519,950)
|
|
Accumulated other
comprehensive income
|
12,350
|
|
13,787
|
|
|
|
Total stockholders'
equity
|
424,658
|
|
452,763
|
|
|
|
|
$
1,078,460
|
|
$
1,144,153
|
|
* The Company's debt,
substantially all of which represents Term Debt outstanding under
our 2020 Credit Facility, is scheduled to mature on March 3, 2025,
and is therefore presented entirely in the above as a current
liability as of March 31, 2024. The Company is currently seeking to
refinance the Term Debt before filing of the Form 10-Q for the
quarter ended March 31, 2024. Should a refinancing
transaction occur prior to the filing of our Form 10-Q the Term
Debt would be presented in the Company's Form 10-Q as Long-term
debt, net of current in accordance with US GAAP.
|
|
RIBBON COMMUNICATIONS
INC.
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
|
March
31,
|
|
March
31,
|
|
|
|
|
|
2024
|
|
2023
|
Cash flows from
operating activities:
|
|
|
|
|
Net loss
|
|
$
(30,361)
|
|
$
(38,305)
|
|
Adjustments to
reconcile net loss to cash flows provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization of property and equipment
|
3,394
|
|
3,510
|
|
|
Amortization of
intangible assets
|
13,257
|
|
14,653
|
|
|
Amortization of debt
issuance costs
|
716
|
|
1,065
|
|
|
Amortization of
accumulated other comprehensive gain related to interest rate
swap
|
(1,756)
|
|
-
|
|
|
Stock-based
compensation
|
4,522
|
|
5,848
|
|
|
Deferred income
taxes
|
(2,620)
|
|
(6,048)
|
|
|
Gain on sale of
swap
|
-
|
|
(7,301)
|
|
|
Change in fair value of
warrant liability
|
632
|
|
-
|
|
|
Change in fair value of
preferred stock liability
|
1,512
|
|
-
|
|
|
Dividends accrued on
preferred stock liability
|
1,355
|
|
-
|
|
|
Foreign currency
exchange (gains) losses
|
1,144
|
|
(2,185)
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
Accounts
receivable
|
55,384
|
|
19,742
|
|
|
|
Inventory
|
(4,379)
|
|
(2,917)
|
|
|
|
Other operating
assets
|
7,923
|
|
15,031
|
|
|
|
Accounts
payable
|
(17,837)
|
|
(10,405)
|
|
|
|
Accrued expenses and
other long-term liabilities
|
(11,800)
|
|
11,521
|
|
|
|
Deferred
revenue
|
(7,986)
|
|
6,924
|
|
|
|
|
Net cash provided by
operating activities
|
13,100
|
|
11,133
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Purchases of property
and equipment
|
(2,513)
|
|
(2,413)
|
|
Purchases of software
licenses
|
(150)
|
|
-
|
|
|
|
|
Net cash used in
investing activities
|
(2,663)
|
|
(2,413)
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Borrowings under
revolving line of credit
|
15,000
|
|
-
|
|
Principal payments on
revolving line of credit
|
(15,000)
|
|
-
|
|
Principal payments of
term debt
|
(5,014)
|
|
(80,015)
|
|
Payment of debt
issuance costs
|
-
|
|
(1,562)
|
|
Proceeds from issuance
of preferred stock and warrant liabilities
|
-
|
|
53,350
|
|
Proceeds from the
exercise of stock options
|
17
|
|
1
|
|
Payment of tax
withholding obligations related to net share settlements of
restricted stock awards
|
(846)
|
|
(1,893)
|
|
|
|
|
Net cash used in
financing activities
|
(5,843)
|
|
(30,119)
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents
|
(293)
|
|
171
|
|
|
|
|
|
|
|
|
Net increase (decrease)
in cash and cash equivalents
|
4,301
|
|
(21,228)
|
Cash and cash
equivalents, beginning of year
|
26,630
|
|
67,262
|
Cash and cash
equivalents, end of period
|
$
30,931
|
|
$
46,034
|
RIBBON COMMUNICATIONS
INC.
Supplemental Information
(in thousands)
(unaudited)
|
|
The following tables
provide the details of stock-based compensation included as
components
of other line items in the Company's Consolidated Statements of
Operations and the line items
in which these amounts are reported.
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|
|
|
|
2024
|
|
2023
|
|
2023
|
Stock-based
compensation
|
|
|
|
|
|
Cost of revenue -
product
|
$
106
|
|
$
125
|
|
$
149
|
Cost of revenue -
service
|
472
|
|
550
|
|
535
|
|
Cost of
revenue
|
578
|
|
675
|
|
684
|
|
|
|
|
|
|
|
|
|
Research and
development
|
1,068
|
|
1,112
|
|
1,262
|
Sales and
marketing
|
1,157
|
|
1,438
|
|
2,129
|
General and
administrative
|
1,719
|
|
1,667
|
|
1,773
|
|
Operating
expense
|
3,944
|
|
4,217
|
|
5,164
|
|
|
|
|
|
|
|
|
|
|
|
Total stock-based
compensation
|
$
4,522
|
|
$
4,892
|
|
$
5,848
|
RIBBON COMMUNICATIONS
INC.
Reconciliation of Non-GAAP and GAAP Financial Measures
(in thousands, except per share amounts)
(unaudited)
|
|
|
Three months
ended
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|
2024
|
|
2023
|
|
2023
|
|
|
|
|
|
|
GAAP Gross
margin
|
51.2 %
|
|
53.8 %
|
|
43.7 %
|
Stock-based
compensation
|
0.3 %
|
|
0.3 %
|
|
0.4 %
|
Amortization of
acquired technology
|
3.6 %
|
|
2.7 %
|
|
4.0 %
|
Non-GAAP Gross
margin
|
55.1 %
|
|
56.8 %
|
|
48.1 %
|
|
|
|
|
|
|
GAAP Net income
(loss)
|
$
(30,361)
|
|
$
7,079
|
|
$
(38,305)
|
Stock-based
compensation
|
4,522
|
|
4,892
|
|
5,848
|
Amortization of
acquired intangible assets
|
13,257
|
|
13,166
|
|
14,653
|
Litigation
costs
|
951
|
|
538
|
|
177
|
Acquisition-, disposal-
and integration-related
|
-
|
|
1,494
|
|
1,642
|
Restructuring and
related
|
3,065
|
|
2,285
|
|
6,937
|
Preferred stock and
warrant liability issuance costs
|
-
|
|
-
|
|
3,545
|
Preferred stock and
warrant liability mark-to-market adjustment
|
3,499
|
|
3,724
|
|
-
|
Tax effect of non-GAAP
adjustments
|
3,971
|
|
(11,606)
|
|
2,676
|
Non-GAAP Net income
(loss)
|
$
(1,096)
|
|
$
21,572
|
|
$
(2,827)
|
|
|
|
|
|
|
GAAP Diluted
earnings (loss) per share
|
$
(0.18)
|
|
$
0.04
|
|
$
(0.23)
|
Stock-based
compensation
|
0.03
|
|
0.03
|
|
0.04
|
Amortization of
acquired intangible assets
|
0.07
|
|
0.08
|
|
0.08
|
Litigation
costs
|
0.01
|
|
*
|
|
*
|
Acquisition-, disposal-
and integration-related
|
-
|
|
0.01
|
|
0.01
|
Restructuring and
related
|
0.02
|
|
0.01
|
|
0.04
|
Preferred stock and
warrant liability issuance costs
|
-
|
|
-
|
|
0.02
|
Preferred stock and
warrant liability mark-to-market adjustment
|
0.02
|
|
0.02
|
|
-
|
Tax effect of non-GAAP
adjustments
|
0.02
|
|
(0.07)
|
|
0.02
|
Non-GAAP Diluted
earnings (loss) per share
|
$
(0.01)
|
|
$
0.12
|
|
$
(0.02)
|
|
|
|
|
|
|
Weighted average
shares used to compute diluted earnings (loss) per
share
|
|
|
|
|
|
Shares used to
compute GAAP diluted earnings (loss) per share
|
172,428
|
|
171,755
|
|
168,541
|
Shares used to
compute Non-GAAP diluted earnings (loss) per
share
|
172,428
|
|
172,990
|
|
168,541
|
|
|
|
|
|
|
GAAP Income (loss)
from operations
|
$
(13,486)
|
|
$
16,670
|
|
$
(35,189)
|
Depreciation
|
3,394
|
|
3,502
|
|
3,510
|
Stock-based
compensation
|
4,522
|
|
4,892
|
|
5,848
|
Amortization of
acquired intangible assets
|
13,257
|
|
13,166
|
|
14,653
|
Litigation
costs
|
951
|
|
538
|
|
177
|
Acquisition-, disposal-
and integration-related
|
-
|
|
1,494
|
|
1,642
|
Restructuring and
related
|
3,065
|
|
2,285
|
|
6,937
|
Non-GAAP Adjusted
EBITDA
|
$
11,703
|
|
$
42,547
|
|
$
(2,422)
|
|
|
|
|
|
|
* Less than $0.01
impact on earnings (loss) per share.
|
|
|
|
|
|
RIBBON COMMUNICATIONS
INC.
Reconciliation of Non-GAAP and GAAP Financial Measures
(in thousands)
(unaudited)
|
|
|
|
|
Trailing Twelve
Months
|
|
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|
2024
|
|
2023
|
|
2023
|
|
|
|
|
|
|
GAAP Income (loss)
from operations
|
$
(2,582)
|
|
$
(24,285)
|
|
$
(44,459)
|
Depreciation
|
13,989
|
|
14,105
|
|
14,920
|
Stock-based
compensation
|
20,480
|
|
21,806
|
|
20,300
|
Amortization of
acquired intangible assets
|
55,495
|
|
56,891
|
|
60,299
|
Litigation
costs
|
2,081
|
|
1,307
|
|
177
|
Acquisition-, disposal-
and integration-related
|
2,834
|
|
4,476
|
|
6,079
|
Restructuring and
related
|
12,337
|
|
16,209
|
|
12,956
|
Non-GAAP Adjusted
EBITDA
|
$
104,634
|
|
$
90,509
|
|
$
70,272
|
RIBBON COMMUNICATIONS
INC.
Reconciliation of Non-GAAP and GAAP Financial Measures -
Outlook
(unaudited)
|
|
|
|
|
Three months
ending
|
|
Year
ending
|
|
|
|
June 30,
2024
|
|
December 31,
2024
|
|
|
|
Midpoint (1)
|
|
|
Range
|
|
Midpoint (1)
|
|
Range
|
|
|
|
|
|
|
|
|
|
|
|
Revenue ($
millions)
|
$
205
|
|
|
+/-
$5M
|
|
$
855
|
|
+/- $15M
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin:
|
|
|
|
|
|
|
|
|
|
GAAP
outlook
|
50.6 %
|
|
|
|
|
50.3 %
|
|
|
|
Stock-based
compensation
|
0.3 %
|
|
|
|
|
0.3 %
|
|
|
|
Amortization of
acquired technology
|
3.1 %
|
|
|
|
|
2.9 %
|
|
|
|
|
Non-GAAP
outlook
|
54.0 %
|
|
|
+/-
0.5%
|
|
53.5 %
|
|
+/- 0.5%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA ($
millions):
|
|
|
|
|
|
|
|
|
|
GAAP income (loss)
from operations
|
$
(2.5)
|
|
|
|
|
$
13.4
|
|
|
|
Depreciation
|
3.7
|
|
|
|
|
14.8
|
|
|
|
Stock-based
compensation
|
4.5
|
|
|
|
|
18.6
|
|
|
|
Amortization of
acquired intangible assets
|
13.0
|
|
|
|
|
50.8
|
|
|
|
Litigation
costs
|
1.1
|
|
|
|
|
2.7
|
|
|
|
Restructuring and
related
|
2.7
|
|
|
|
|
14.7
|
|
|
|
|
Non-GAAP
outlook
|
$
22.5
|
|
|
+/-
$2.5M
|
|
$
115.0
|
|
+/- $5M
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Q2 2024 and FY 2024
outlook represents the midpoint of the expected ranges
|
|
|
|
|
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SOURCE Ribbon Communications Inc.