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Oct 01, 2023
Cognex Q3 2023 Earnings Report
Cognex reported a revenue decrease of 6% due to lower consumer electronics revenue and soft investment across end markets, while managing expenses and entering new markets through strategic initiatives.
Key Takeaways
Cognex Corporation reported Q3 2023 financial results, with revenue declining by 6% year-over-year to $197.241 million. The decrease was primarily due to lower revenue from consumer electronics and soft investment across various end markets. Net income also decreased by 44% to $18.916 million, and diluted EPS decreased to $0.11. The company focused on long-term growth by entering new markets, including vision sensors and optical components, through the acquisition of Moritex.
Revenue decreased by 6% year-over-year, primarily due to lower revenue from consumer electronics and softer demand in China.
Gross margin was 72%, a slight decrease from 73% in Q3 2022, attributed to a less favorable product and industry mix.
Operating expenses increased by 9% due to employee-related expenses and transaction costs related to the acquisition of Moritex Corporation.
Cognex entered two new adjacent markets, vision sensors and optical components, expanding served market size by $1.5 billion.
Forward Guidance
Cognex anticipates Q4 2023 revenue to be between $175 million and $195 million, including $5 million to $7 million from Moritex. Gross margin is expected to be approximately 70% on a non-GAAP basis, and operating expenses are projected to increase by low single digits on a non-GAAP basis. The effective tax rate is expected to be 16% on a non-GAAP basis.
Positive Outlook
- Revenue range includes $5 million to $7 million from Moritex.
- Revenue is relatively consistent sequentially with Q3 2023.
- Continued diligent cost management is expected.
- The effective tax rate is expected to be 16% on a non-GAAP basis.
- Operating expenses are expected to increase by low single digits on a non-GAAP basis.
Challenges Ahead
- Revenue reflects difficult business environment.
- Gross margin is expected to be approximately 70% on a non-GAAP basis.
- Gross margin is primarily due to continued operating deleverage.
Historical Earnings Impact
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