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Oct 02, 2022
Cognex Q3 2022 Earnings Report
Cognex reported a decrease in revenue and net income due to the June fire and a slowdown in e-commerce fulfillment capacity expansion.
Key Takeaways
Cognex reported a significant decrease in revenue and net income for Q3 2022. Revenue decreased by 26% year-over-year, and net income decreased by 57%. The decline was attributed to a fire at a contract manufacturer and a slowdown in e-commerce fulfillment capacity expansion.
Revenue decreased by 26% year-over-year due to logistics slowdown and fire disruption.
Gross margin increased to 73% due to favorable revenue mix.
Operating income decreased due to lower revenue and fire-related charges.
Q4 revenue is expected to be between $235 million and $255 million.
Cognex
Cognex
Forward Guidance
Cognex expects Q4 2022 revenue to be between $235 million and $255 million with gross margin in the low-70% range and an effective tax rate of 16%, excluding discrete tax items.
Positive Outlook
- Improved production lead times relative to Q3-22.
- Growth from the broader market.
- Sequential increase in revenue due to improved production lead times.
- Replenished inventory positions following the fire more quickly than anticipated.
- Business disruption from the fire is believed to be behind us.
Challenges Ahead
- Lower spending on large projects in logistics.
- Roughly 10-basis point unfavorable impact of currency exchange rates.
- Gross margin reflects significant premiums paid to procure components due to the fire.
- Overcapacity in logistics will dampen results again in Q4.
- The combined total of expenses for RD&E and SG&A is expected to increase by low-single digits on a sequential basis due to higher incentive compensation