RADCOM Delivers 20% YoY Revenue Growth and EPS up by 120%
Reaffirming Company's Commitment to Profitable Growth and Long-Term Shareholder Value
- Highest quarterly revenues of $14.8 million
- Record half-year revenue and profitability
- Peak cash level of $86.1 million
TEL AVIV, Israel, Aug. 7, 2024 /PRNewswire/ -- RADCOM Ltd. (Nasdaq: RDCM), an industry leader in automated assurance and intelligent analytics for telecom operators transitioning to 5G, announced today its financial results for the second quarter ended June 30, 2024.
Hilik Itman, RADCOM's interim Chief Executive Officer, commented, "This quarter, we continued to execute our strategy to drive profitable growth and long-term shareholder value. We achieved record quarterly revenues of $14.8 million, up 20% from the second quarter of 2023.
"Our net income increased by approximately 120%, driven by strong revenue growth. We maintained our positive cash flow generation, achieving a new milestone with our cash and cash equivalents reaching a record high of $86.1 million. We are on track to meet our 2024 financial guidance and deliver revenue and profitability growth.
"Since the start of the year, we have secured over $50 million in new 5G contracts, including several seven-digit contracts across various geographic markets, while maintaining significant recurring revenues. This shows the demand for our leading solutions and boosts our revenues as telecom operators transition to 5G."
Key highlights Q2 2024:
- Total revenues for the second quarter were $14.8 million, compared to $12.4 million in the second quarter of 2023, representing a 20% year-over-year growth, a new company record.
- GAAP net income for the second quarter was $1.7 million, or $0.11 diluted EPS, compared to $0.8 million, or $0.05 diluted EPS, for the second quarter of 2023, representing an approximately 120% year-over-year increase compared to the second quarter of 2023.
- Non-GAAP net income for the period was $3.1 million, or $0.20 diluted EPS, compared to $2.1 million, or $0.13 diluted EPS, for the second quarter of 2023.
- As of June 30, 2024, the Company had cash, cash equivalents, and short-term bank deposits of $86.1 million and no debt, ending the quarter with its highest-ever cash levels.
Key highlights H1 2024
- Total revenues for the first six months were $28.9 million, compared to $24.4 million in the first six months of 2023, representing a 19% year-over-year growth.
- GAAP net income for the first six months was $2.5 million, or $0.16 diluted EPS, compared to $1.4 million, or $0.09 diluted EPS for the first six months of 2023.
- Non-GAAP net income for the first six months was $6.0 million, or $0.38 diluted EPS, compared to $3.9 million, or $0.25 diluted EPS, for the first six months of 2023.
Mr. Itman concluded, "The efficient growth we achieved in the first six months of 2024 provides a strong foundation for our continued success in the remaining six months of 2024, and we believe the best is yet to come. We are witnessing increasing demand for our solutions across multiple regions, particularly in North America. The heightened demand is reflected in our expanding sales pipeline, which has the potential to drive further growth and enhance shareholder returns.
"This gives us the confidence to raise our 2024 revenue guidance to $58 to $61 million (from $57 to $60 million)."
Earnings conference call and webcast
RADCOM's management will hold an interactive conference call on the same day at 8:00 AM Eastern Time (3:00 PM Israel Daylight Time) to discuss the results and answer participants' questions.
- Live webcast: A live webcast of the presentation will be available at https://Veidan.activetrail.biz/radcomq2-2024. The webcast will be archived for 90 days following the live presentation.
- Joining the interactive call: Please dial in approximately five minutes before the call is scheduled to begin:
- From the US (toll-free): +1-866-652-8972
- From other locations: +972-3-918-0644
A conference call replay will be available a few hours after the call on RADCOM's investor relations webpage at https://radcom.com/investor-relations.
For all investor inquiries, please contact:
Investor Relations:
Miri Segal
MS-IR LLC
917-607-8654
[email protected]
Company Contact: Hadar Rahav
CFO
+972-77-7745062
[email protected]
RADCOM (Nasdaq: RDCM) is the leading expert in 5G-ready cloud-native, network intelligence solutions for telecom operators transitioning to 5G. RADCOM Network Intelligence consists of RADCOM Network Visibility, RADCOM Service Assurance, and RADCOM Network Insights. The RADCOM Network Intelligence suite offers intelligent, container-based, on-demand solutions to deliver network analysis from the RAN to the core for 5G assurance. Utilizing automated and dynamic solutions with smart minimal data collection and on-demand troubleshooting, and cutting-edge techniques based on machine learning, these solutions work in harmony to provide operators with an understanding of the entire customer experience and allow them to troubleshoot network performance from a high to granular level while reducing storage costs and cloud resource utilization. For more information on how to RADCOMize your network today, please visit www.radcom.com, the content of which does not form a part of this press release.
Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the reader's overall understanding of the Company's financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, financial income (expenses), acquisition-related expenses, and amortization of intangible assets related to acquisitions, the Company's non-GAAP results provide information to both management and investors that is useful in assessing the Company's core operating performance and in evaluating and comparing the Company's results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with GAAP.
Risks Regarding Forward-Looking Statements
Certain statements made herein that use words such as "estimate," "project," "intend," "expect," "'believe," "may," "might," " potential," "anticipate," "plan" or similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. For example, when the Company discusses its full-year 2024 revenue guidance, market trends, and demand for the Company's products and services, expanding its sales pipeline, profitability, growth, and enhancing shareholder returns, it uses forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that could cause the actual results, performance, or achievements of the Company to be materially different from those that may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in demand for the Company's products, inability to timely develop and introduce new technologies, products, and applications, loss of market share and pressure on prices resulting from competition and the effects of the war in Israel. For additional information regarding these and other risks and uncertainties associated with the Company's business, reference is made to the Company's reports filed from time to time with the U.S. Securities and Exchange Commission. The Company does not undertake to revise or update any forward-looking statements for any reason.
RADCOM Ltd. |
|||||||
Consolidated Statements of Operations |
|||||||
Unaudited |
|||||||
(thousands of U.S. dollars, except share and per share data) |
|||||||
Three months ended |
Six months ended |
||||||
2024 |
2023 |
2024 |
2023 |
||||
Revenues |
$ 14,801 |
$ 12,372 |
$ 28,924 |
$ 24,395 |
|||
Cost of revenues |
3,794 |
3,480 |
7,545 |
6,828 |
|||
Gross profit |
11,007 |
8,892 |
21,379 |
17,567 |
|||
Research and development, gross |
4,621 |
4,952 |
9,214 |
9,721 |
|||
Less - royalty-bearing participation |
180 |
180 |
389 |
442 |
|||
Research and development, net |
4,441 |
4,772 |
8,825 |
9,279 |
|||
Sales and marketing |
4,325 |
3,351 |
8,610 |
6,664 |
|||
General and administrative |
1,361 |
1,215 |
3,374 |
2,444 |
|||
Total operating expenses |
10,127 |
9,338 |
20,809 |
18,387 |
|||
Operating income (loss) |
880 |
(446) |
570 |
(820) |
|||
Financial income, net |
854 |
1,260 |
1,959 |
2,286 |
|||
Income before taxes on income |
1,734 |
814 |
2,529 |
1,466 |
|||
Taxes on income |
(27) |
(33) |
(60) |
(64) |
|||
Net income |
$ 1,707 |
$ 781 |
$ 2,469 |
$ 1,402 |
|||
Basic and diluted net income per ordinary share |
$ 0.11 |
$ 0.05 |
$ 0.16 |
$ 0.09 |
|||
Weighted average number of ordinary shares used in computing |
15,608,402 |
15,063,112 |
15,517,958 |
14,977,743 |
|||
Weighted average number of ordinary shares used in computing |
15,978,799 |
15,658,748 |
15,922,855 |
15,614,553 |
Three months
|
Six months
|
||||||
2024 |
2023 |
2024 |
2023 |
||||
GAAP gross profit |
$ 11,007 |
$ 8,892 |
$ 21,379 |
$ 17,567 |
|||
Stock-based compensation |
99 |
74 |
183 |
163 |
|||
Amortization of intangible assets |
56 |
43 |
112 |
43 |
|||
Non-GAAP gross profit |
$ 11,162 |
$ 9,009 |
$ 21,674 |
$ 17,773 |
|||
GAAP research and development, net |
$ 4,441 |
$ 4,772 |
$ 8,825 |
$ 9,279 |
|||
Stock-based compensation |
525 |
536 |
1,062 |
1,081 |
|||
Non-GAAP research and development, net |
$ 3,916 |
$ 4,236 |
$ 7,763 |
$ 8,198 |
|||
GAAP sales and marketing |
$ 4,325 |
$ 3,351 |
$ 8,610 |
$ 6,664 |
|||
Stock-based compensation |
$ 485 |
328 |
989 |
636 |
|||
Amortization of intangible assets |
$ 29 |
21 |
58 |
21 |
|||
Non-GAAP sales and marketing |
$ 3,811 |
$ 3,002 |
$ 7,563 |
$ 6,007 |
|||
GAAP general and administrative |
$ 1,361 |
$ 1,215 |
$ 3,374 |
$ 2,444 |
|||
Stock-based compensation |
202 |
249 |
1,041 |
514 |
|||
Acquisition related expenses |
- |
37 |
- |
37 |
|||
Non-GAAP general and administrative |
$ 1,159 |
$ 929 |
$ 2,333 |
$ 1,893 |
|||
GAAP total operating expenses |
$ 10,127 |
$ 9,338 |
$ 20,809 |
$ 18,387 |
|||
Stock-based compensation |
1,212 |
1,113 |
3,092 |
2,231 |
|||
Amortization of intangible assets |
29 |
21 |
58 |
21 |
|||
Acquisition related expenses |
- |
37 |
- |
37 |
|||
Non-GAAP total operating expenses |
$ 8,886 |
$ 8,167 |
$ 17,659 |
$ 16,098 |
|||
GAAP operating income (loss) |
$ 880 |
$ (446) |
$ 570 |
$ (820) |
|||
Stock-based compensation |
1,311 |
1,187 |
3,275 |
2,394 |
|||
Amortization of intangible assets |
85 |
64 |
170 |
64 |
|||
Acquisition related expenses |
- |
37 |
- |
37 |
|||
Non-GAAP operating income |
$ 2,276 |
$ 842 |
$ 4,015 |
$ 1,675 |
RADCOM LTD. |
|||||||
Reconciliation of GAAP to Non-GAAP Financial Information |
|||||||
Unaudited |
|||||||
(thousands of U.S. dollars, except share and per share data) |
|||||||
Three months ended June 30, |
Six months ended June 30, |
||||||
2024 |
2023 |
2024 |
2023 |
||||
GAAP income before taxes on income |
$ 1,734 |
$ 814 |
$ 2,529 |
$ 1,466 |
|||
Stock-based compensation |
1,311 |
1,187 |
3,275 |
2,394 |
|||
Amortization of intangible assets |
85 |
64 |
170 |
64 |
|||
Acquisition related expenses |
34 |
66 |
71 |
66 |
|||
Non-GAAP income before taxes on income |
$ 3,164 |
$ 2,131 |
$ 6,045 |
$ 3,990 |
|||
GAAP net income |
$ 1,707 |
$ 781 |
$ 2,469 |
$ 1,402 |
|||
Stock-based compensation |
1,311 |
1,187 |
3,275 |
2,394 |
|||
Amortization of intangible assets |
85 |
64 |
170 |
64 |
|||
Acquisition related expenses |
34 |
66 |
71 |
66 |
|||
Non-GAAP net income |
$ 3,137 |
$ 2,098 |
$ 5,985 |
$ 3,926 |
|||
GAAP net income per diluted share |
$ 0.11 |
$ 0.05 |
$ 0.16 |
$ 0.09 |
|||
Stock-based compensation |
0.08 |
0.08 |
0.21 |
0.16 |
|||
Amortization of intangible assets |
0.01 |
(*) |
0.01 |
(*) |
|||
Acquisition related expenses |
(*) |
(*) |
(*) |
(*) |
|||
Non-GAAP net income per diluted share |
$ 0.20 |
$ 0.13 |
$ 0.38 |
$ 0.25 |
|||
Weighted average number of shares used to |
15,978,799 |
15,658,748 |
15,922,855 |
15,614,553 |
|||
(*) Less than $ 0.01 |
RADCOM Ltd. Consolidated Balance Sheets Unaudited |
|||
As of |
As of |
||
June 30, 2024 |
December 31, 2023 |
||
Current Assets |
|||
Cash and cash equivalents |
$ 15,248 |
$ 10,892 |
|
Short-term bank deposits |
70,864 |
71,273 |
|
Trade receivables, net |
18,071 |
13,412 |
|
Inventories |
695 |
246 |
|
Other accounts receivable and prepaid expenses |
1,353 |
1,592 |
|
Total Current Assets |
106,231 |
97,415 |
|
Non-Current Assets |
|||
Severance pay fund |
3,006 |
3,142 |
|
Other long-term receivables |
3,353 |
1,573 |
|
Property and equipment, net |
772 |
798 |
|
Operating lease right-of-use assets |
1,148 |
1,651 |
|
Goodwill and intangible assets, net |
2,780 |
2,950 |
|
Total Non-Current Assets |
11,059 |
10,114 |
|
Total Assets |
$ 117,290 |
$ 107,529 |
|
Liabilities and Shareholders' Equity |
|||
Current Liabilities |
|||
Trade payables |
$ 3,400 |
$ 2,640 |
|
Deferred revenues and advances from customers |
4,140 |
1,469 |
|
Employee and payroll accruals |
5,397 |
5,400 |
|
Operating lease liabilities |
627 |
1,062 |
|
Other liabilities and accrued expenses |
10,449 |
9,540 |
|
Total Current Liabilities |
24,013 |
20,111 |
|
Non-Current Liabilities |
|||
Accrued severance pay |
3,680 |
3,728 |
|
Operating lease liabilities |
472 |
561 |
|
Other liabilities and accrued expenses |
653 |
638 |
|
Total Non-Current Liabilities |
4,805 |
4,927 |
|
Total Liabilities |
$ 28,818 |
$ 25,038 |
|
Shareholders' Equity |
|||
Share capital |
$ 755 |
$ 736 |
|
Additional paid-in capital |
157,954 |
154,697 |
|
Accumulated other comprehensive loss |
(2,794) |
(3,030) |
|
Accumulated deficit |
(67,443) |
(69,912) |
|
Total Shareholders' Equity |
88,472 |
82,491 |
|
Total Liabilities and Shareholders' Equity |
$ 117,290 |
$ 107,529 |
SOURCE RADCOM Ltd.
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