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Apr 30, 2022
Comtech Q3 2022 Earnings Report
Comtech's financial performance exceeded expectations, showing sequential quarterly revenue and Adjusted EBITDA growth, while facing a challenging and unpredictable operating environment.
Key Takeaways
Comtech reported Q3 fiscal year 2022 results with consolidated net sales of $122.1 million, a sequential increase of 1.4% from Q2 2022. The company's Adjusted EBITDA was $11.2 million, up 14.3% sequentially. However, GAAP net loss attributable to common stockholders was $1.7 million, with a GAAP EPS loss of $0.06, although Non-GAAP EPS was an income of $0.06.
Consolidated net sales were $122.1 million, up 1.4% sequentially from Q2 2022.
Adjusted EBITDA of $11.2 million, a 14.3% sequential increase.
New bookings were $113.4 million, resulting in a quarterly book-to-bill ratio of 0.93x.
Backlog of $602.3 million as of April 30, 2022.
Forward Guidance
Comtech adjusted its financial targets for fiscal year 2022 due to market conditions and near-term uncertainties.
Positive Outlook
- Q4 fiscal 2022 net sales are expected to approximate $123.0 million resulting in expected fiscal 2022 consolidated net sales of approximately $482.0 million.
- Q4 fiscal 2022 Adjusted EBITDA is expected to approximate $11.5 million resulting in expected fiscal 2022 Adjusted EBITDA of approximately $38.0 million.
- The underlying demand environment remains intact, and Comtech believes it is growing stronger.
- Government Solutions segment backlog is up from last quarter.
- Overall demand for satellite earth station products is solid, and the pipeline for those products is growing.
Challenges Ahead
- Incremental research and development expenses.
- Removal of several identified and viable opportunities in both Commercial Solutions and Government Solutions segments that are no longer expected to occur in Q4.
- Two NG-911 opportunities in the Commercial Solutions segment are now in holding patterns.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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