CommScope sees rising gross sales, continued provide chain pressures

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CommScope reported larger gross sales and an enchancment in income in comparison with final yr’s third quarter, though the corporate mentioned that it’s being hampered by part and supplies shortages which can be impacted its lead occasions and costs.

Internet gross sales for the third quarter of 2022 have been up 13.1% year-over-year to $2.38 billion, and CommScope reported income of $22.9 million in comparison with a lack of $124 million within the year-ago interval.

When it comes to enterprise unit outcomes, CommScope reported that its enterprise segments with the strongest progress have been its Connectivity and Cable Options (CCS) enterprise, which noticed web gross sales up almost 28% to $1 billion; its Networking, Clever Mobile and Safety Options (NICS) unit, with web gross sales up 24.5% from the identical time final yr, as a consequence of progress from Ruckus Networks; and its Out of doors Wi-fi Networks (OWN) enterprise, which noticed web gross sales rise almost 7% year-over-year. Internet gross sales in its Home-based business unit dropped by 5.7% due ot declines in broadband dwelling options, the corporate mentioned.

Regardless of the strong outcomes, traders nonetheless despatched the corporate’s inventory tumbling 25% by the shut of the markets on Thursday.

CommScope mentioned that pandemic impacts have receded, however now it’s coping with the aftermath: Improve in demand, but in addition supplies and part shortages, elevated logistical prices, pricing volatility and inflation.

CommScope mentioned it “has seen a big enhance in prices that has negatively impacted its outcomes of operations,” plus a restricted obtainable provide of reminiscence units, capacitors and chips which can be impacting its lead occasions—so it’s elevating costs and sustaining larger stock ranges. Whereas the corporate expects international provide chain points to enhance within the fourth quarter of the yr, it additionally says that some shortages will proceed into 2023, and “rising rates of interest, vitality costs and worry about an financial slow-down might affect the timing and quantity of capital spending by its clients in 2023.”

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