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NETGEAR Q1 2025 Earnings Report
NETGEAR reported its first quarter 2025 financial results, showing a decrease in net revenue but improvements in gross and operating margins compared to the prior year.
Key Takeaways
NETGEAR reported first quarter 2025 net revenue of $162.1 million, a 1.5% decrease year-over-year. Despite the revenue dip, the company saw significant improvements in GAAP and non-GAAP gross margins, up 550 basis points each, and reduced its GAAP and non-GAAP operating losses. Non-GAAP EPS turned positive at $0.02.
Net revenue for Q1 2025 was $162.1 million, a 1.5% decrease from Q1 prior year.
GAAP gross margin improved to 34.8% and non-GAAP gross margin to 35.0%, both up 550 basis points year-over-year.
GAAP operating loss significantly narrowed to $(12.8) million from $(21.6) million in Q1 prior year, and non-GAAP operating loss narrowed to $(2.6) million from $(16.0) million.
Non-GAAP EPS was $0.02, a positive shift from $(0.28) in Q1 prior year.
Revenue by Geographic Location
Forward Guidance
For Q2 2025, NETGEAR expects net revenue to be in the range of $155 million to $170 million. Gross margin is expected to be in line with or slightly decrease from Q1 levels. GAAP operating margin is projected between (10.4)% and (7.4)%, and non-GAAP operating margin between (6.5)% and (3.5)%.
Positive Outlook
- Continued predictable performance aligned with market trends.
- Strong end-user demand expected for ProAV line of managed switches.
- Improvements in supply position for NFB are anticipated.
- Benefits from broader product portfolio expected in Home Networking.
- No expected impact from evolving U.S. trade policy or recently announced tariffs due to manufacturing locations.
Challenges Ahead
- Lengthy lead times for supply may limit ability to capture full topline potential of growing NFB business.
- Gross margin expected to be in line or slightly decrease from Q1 levels.
- Planned investments will ramp up, focusing on insourcing software development and enhancing go-to-market capabilities.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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