Leading provider of high-performance wireless infrastructure solutions, Westell Technologies, Inc. (NASDAQ:WSTL), announces results for its fiscal 2017 Q2.
Westell Technologies, Inc. (WSTL), a leading provider of high-performance wireless infrastructure solutions, today announced results for its fiscal 2017 second quarter ended September 30, 2016 (2Q17). Management will host a conference call to discuss financial and business results tomorrow, Thursday, November 3, 2016, at 9:30 AM Eastern Time (details below).
Consolidated revenue in 2Q17 was $17.8 million, and comprised $6.6 million from the In-Building Wireless (IBW) segment, $5.1 million from the Intelligent Site Management and Services (ISMS) segment, and $6.0 million from the Communication Network Solutions (CNS) segment.
GAAP operating expenses were $12.2 million in 2Q17 compared to $12.3 million in 1Q17. Non-GAAP operating expenses, which excludes stock-based compensation, amortization of acquired intangible assets, and restructuring and restructuring-related charges, were $7.8 million in 2Q17 compared to $9.6 million in 1Q17.
“As anticipated, 2Q17 revenue was up significantly from 1Q17, and all three segments grew sequentially with IBW up 9%, ISMS up 23%, and CNS up 32%,” said Kirk Brannock, President and CEO of Westell Technologies. “We also made great progress on the expense side and the bottom line, as we are now seeing the positive effects of our initial actions to reduce expenses.”
In October, Westell began to transition its IBW final assembly and test operations to Spinnaker Contract Manufacturing, Inc. of Tilton, New Hampshire, with an expected completion date of mid-December 2016. “Spinnaker is a trusted partner that has provided Westell with high-quality subassemblies since 2000,” Brannock said. “Streamlining operations is an important part of our path to profitability that will also reduce lead times and drive improved customer satisfaction.”
Cash and short-term investments were $20.9 million at September 30, 2016, compared to $25.3 million at June 30, 2016. Of the $4.4 million change during the quarter, cash used for operating activities was $4.1 million, which included a $2.7 million increase in customer receivables as of September 30, 2016, and $0.5 million for employee severance payments.
In-Building Wireless (IBW) Segment
IBW’s sequential revenue increase was driven primarily by higher sales of our Universal DAS Interface Tray (UDIT) active conditioner. IBW’s segment gross margin, excluding charges (see below), decreased to 36.5% in 2Q17 from 39.0% in 1Q17, due primarily to a less favorable mix.
Intelligent Site Management & Services (ISMS) Segment
ISMS’s sequential revenue increase was driven primarily by higher deployment services revenue which, in turn, resulted in a less favorable mix that drove ISMS’s gross margin to decrease in 2Q17 compared to 1Q17.
CNS’s sequential revenue increase was driven primarily by higher sales of Integrated Cabinets which, in turn, resulted in a less favorable mix that drove CNS’s gross margin to decrease in 2Q17 compared to 1Q17.
Conference Call Information
Management will discuss financial and business results during the quarterly conference call on Thursday, November 3, 2016, at 9:30 AM Eastern Time. Investors may quickly register online in advance of the call at https://www.conferenceplus.com. After registering, participants receive dial-in numbers, a passcode and a registration ID that is used to uniquely identify their presence and automatically join them into the audio conference. A participant may also register by telephone on November 3, 2016, by calling 888-206-4065 no later than 8:15 AM Central Time (9:15 AM Eastern Time) and providing the operator confirmation number 43632542.
This news release and related information that may be discussed on the conference call, will be posted on the Investor Relations section of Westell’s website: http://www.westell.com/about-us/investor-relations/. A digital recording of the entire conference will be available for replay on Westell’s website by approximately 1:00 PM Eastern Time following the conclusion of the conference.
About Westell Technologies
Westell is a leading provider of high-performance wireless infrastructure solutions focused on innovation and differentiation at the edge of communication networks, where end users connect. The Company’s comprehensive set of products and solutions enable service providers and network operators to improve performance and reduce operating expenses. With millions of products successfully deployed worldwide, Westell is a trusted partner for transforming networks into high quality, reliable systems. For more information, please visit www.westell.com.
Westell Technologies, Inc. (NASDAQ:WSTL) shares have moved +1.062% on the news thus far today and have traded in the range of $0.450 – 0.570 during the current session. In order to take a look at where the stock might be headed longer term, investors often look to research firms that cover the stock. Sell-side research firms currently have a consensus one-year price target of $1.500 on the stock. This is according to brokerage analysts polled by Thomson Reuters First Call. The sell-side analysts are projecting earnings per share of $-0.010 for the next fiscal quarter. For the current year, analysts are predicting earnings of $-0.100 per share according to First Call.
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In looking at where the stock is trading on a technical level, the stock is trading -8.996% away from its 50-day moving average of $0.523. Based on the most recent available data, the equity is -68.477% off of its 52-week high of $1.510 and +5.778% away from its 52-week low which is $0.450.
Today, the stock opened at $0.470 and the last bid at the time of writing stood at $0.476. During the session thus far, the equity dipped down to $0.450 and touched $0.570 as the high point. Westell Technologies, Inc. (NASDAQ:WSTL) has a market cap of $29.08M and has seen an average daily volume of 74,175 over the past three months.
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