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Jan 30, 2021
Daktronics Q3 2021 Earnings Report
Daktronics reported a decrease in net sales and orders due to the impact of the COVID-19 pandemic, but gross profit margin improved.
Key Takeaways
Daktronics reported a decrease in net sales and orders for the third quarter of fiscal 2021 compared to the same period last year, primarily due to the impact of the COVID-19 pandemic. However, the company's gross profit margin improved due to a mix of service agreement and product sales and a litigation claim reversal. The company is focused on managing its cost structure and strategically making choices on capacity and investments.
Net sales decreased by 26.3% compared to the third quarter of fiscal 2020, totaling $94.1 million.
Operating loss was $0.2 million, a significant improvement from the $9.2 million loss in the third quarter of fiscal 2020.
Orders for the third quarter of fiscal 2021 decreased by 35.6% compared to the same period last year, amounting to $86.9 million.
Gross profit margin improved to 25.4% compared to 19.2% in the third quarter of fiscal 2020, driven by service agreement and product sales mix and a litigation claim reversal.
Daktronics
Daktronics
Forward Guidance
Daktronics anticipates long-term growth driven by audiovisual industry fundamentals, but expects near-term contraction and volatility due to the pandemic. The company is focused on promoting its value and managing costs amidst uncertain demand, while remaining optimistic about recovery with vaccine distribution.
Positive Outlook
- Strong order backlog going into the fourth quarter.
- Belief that audiovisual industry fundamentals will drive long-term growth.
- Focus on promoting value to new and core markets.
- Managing cost structure to meet uncertain demand.
- Positioned to capitalize on the recovery from the pandemic with vaccine distribution underway.
Challenges Ahead
- Near-term outlook shows areas of contraction.
- Greater volatility expected in the short term.
- Uncertain demand due to the ongoing pandemic.
- Impact on markets serving large gathering spaces.
- Reduction in national advertising spend affecting Out-of-Home advertising customers.