Ceragon Networks Ltd. reported its financial results for the fourth quarter and full year ended December 31, 2020.
Ira Palti, President & CEO, commented: “2020 was a unique year, to say the least. Given the mass exodus to remote work, back-to-back lockdowns, and reduced travel, online services have become more important and in-demand than ever before. Fueled by this ‘new normal,’ there arose a strong global demand for connectivity which drove telcos to accelerate their evolution to 5G.”
“As the recognized best-in-class provider of wireless hauling solutions, we believe we are ideally positioned to provide operators with everything they need to make this 5G transition successful: the technology, including both our signature IP-50 Platform available today, and our advanced 5G hauling chipset which we expect to complete tape-out during the first half of 2021 and be integrated into our advanced 5G solutions in 2022; the expertise, ranging from regulatory and deployment strategy to design and more; and finally the on-the-ground deployment and operational services. In fact, we are already in progress with large 5G network development processes moving us from design wins to proof of concepts and purchase orders.”
“At Ceragon, we have a history of benefitting from the transition between wireless generations, first as 2G moved to 3G, and later when 3G transitioned to 4G. As the new 5G technology builds momentum, we believe we will do again what we do best: leverage this transition to take our company story to the next level.”
Primary Fourth Quarter 2020 Financial Results:
Revenues were $74.0 million, up 3.8% from $71.3 million in Q4 2019 and up 4.8% from $70.6 million in Q3 2020. Our revenues varied from region to region and were in line with the effect that COVID has had on local business operations and network build-out plans.
Gross profit was $21.6 million, giving us a gross margin of 29.1%, compared with a gross margin of 31.7% in Q4 2019 and 33.4% in Q3 2020. The relatively low gross margin reflects a one-time impact of agreements reached with several customers, which we believe will improve our future business with them, as well as continued high supply chain costs due to the COVID-19 environment.
Operating income (loss) was $(1.5) million compared with $(2.2) million for Q4 2019 and $3.4 million for Q3 2020.
Net income (loss) was $(6.3) million, or $(0.08) per diluted share compared with $(4.1) million, or $(0.05) per diluted share for Q4 2019 and $1.6 million, or $0.02 per diluted share for Q3 2020.
Non-GAAP results were as follows: Gross margin was 28.9%, operating income was $0.5 million, and net loss was $(3.5) million, or $(0.04) per diluted share.
Cash and cash equivalents was $27.1 million at December 31, 2020, compared to $29.2 million at September 30, 2020.
Primary Full Year 2020 Financial Results:
Revenues were $262.9 million, down 7.9% from $285.6 million in 2019.
Gross profit was $75.6 million, giving us a gross margin of 28.8%, compared with a gross margin of 33.9% in 2019.
Operating income (loss) was$(7.6) million, compared to operating income of $7.3 million in 2019.
Net loss was$(17.1) million, or $(0.21) per diluted share. Net loss for 2019 was $(2.3) million, or $ (0.03) per diluted share.
Non-GAAP results were as follows: Gross margin was 28.7%, operating loss was $(4.3) million, and net loss was $(12.8) million, or $(0.16) per diluted share.