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Dec 31, 2023
NetScout Q3 2024 Earnings Report
NetScout's revenue was ahead of expectations, benefiting from customer budget spending, while navigating a challenging market environment.
Key Takeaways
NETSCOUT reported third-quarter fiscal year 2024 revenue ahead of expectations, driven by calendar year-end customer budget spending. The cybersecurity business grew year-over-year, while the market environment remained challenging, impacting the service assurance business. The company expects to deliver full fiscal year 2024 revenue at the low-end of its previously disclosed target range.
Total revenue for Q3 FY24 was $218.1 million, compared to $269.5 million in Q3 FY23.
Product revenue for Q3 FY24 was $95.8 million, compared to $149.5 million in Q3 FY23.
Service revenue for Q3 FY24 was $122.2 million, compared to $120.1 million in Q3 FY23.
GAAP net loss for Q3 FY24 was $132.6 million, or ($1.87) per share (diluted), which includes a non-cash goodwill impairment charge. Non-GAAP net income was $52.0 million, or $0.73 per share (diluted).
Revenue by Segment
Forward Guidance
NETSCOUT has updated its financial outlook for fiscal year 2024. Revenue is expected to be approximately $840 million. GAAP loss per share is expected to be in the range of ($1.29) to ($1.24). Non-GAAP net income per share (diluted) is expected to be in the range of $2.15 to $2.20.
Positive Outlook
- Revenue (GAAP and non-GAAP) is now expected to be approximately $840 million, at the low end of the previously disclosed range of $840 million to $860 million.
- Non-GAAP net income per share (diluted) is now expected to be in the range of $2.15 to $2.20, at the higher end of the previously disclosed range of $2.00 to $2.20.
- NETSCOUT now expects the effective tax rate for fiscal year 2024 to be closer to the lower end of the outlook range of 20% to 22%.
- NETSCOUT now expects approximately 72 million to 73 million diluted shares outstanding at the end of fiscal year 2024, which includes the benefit of its recent share repurchase program.
- Cybersecurity business grew year-over-year as enterprise and service provider customers continue to prioritize spending in this area.
Challenges Ahead
- GAAP loss per share is now expected to be in the range of ($1.29) to ($1.24), compared to the previous range of $0.69 to $0.89, primarily due to the non-cash goodwill impairment charge in the third quarter of fiscal 2024.
Revenue & Expenses
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Historical Earnings Impact
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Avg. Return Before/After Earnings
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