Lantronix, Inc. LTRX reported second-quarter fiscal 2025 non-GAAP earnings per share (EPS) of 4 cents, which surpassed the Zacks Consensus Estimate of 3 cents. The bottom line decreased 50% from the prior-year quarter's 8 cents.
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Revenues in the quarter totaled $31.2 million, missing the consensus mark by just 0.1%. The top line also decreased 15.9% year over year, due to reduced orders from the company’s top automotive customer and slightly lower activity in the enterprise market.
Lantronix, Inc. Price, Consensus and EPS Surprise
Lantronix, Inc. price-consensus-eps-surprise-chart | Lantronix, Inc. Quote
Lantronix focuses on Edge Intelligence with key assets in Compute and Connect. Management highlighted its three main markets: Enterprise, Smart Cities and Transportation. The company is advancing Edge artificial intelligence (AI) solutions, integrating Netcomm’s IoT assets and gearing up for future growth.
Following the earnings announcement, shares of LTRX declined 8.8% in the pre-market trading on Feb. 7. In the past year, shares have lost 27.7% compared with the Zacks Computer – Networking industry’s growth of 23.8%.
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In the second quarter, Lantronix acquired NetComm for $6.5 million, expanding its Connect business with 4G and 5G gateways. The integration is progressing well, with key customer engagements, including Vodafone. The company sees growth potential in Australia and New Zealand.
Also, the company is strengthening its partnership with Qualcomm, integrating AI into edge systems for real-time analytics. New projects include banking analytics, electronics quality control and smart farming solutions. Lantronix remains focused on securing new customers and design wins.
LTRX’s Fiscal Q2 in Details
IoT System Solutions revenues (contributed 59.7% to total revenues) in the reported quarter amounted to $18.6 million, decreasing 19.2% year over year.
Embedded IoT Solutions revenues (contributed 34.6% to total revenues) in the reported quarter totaled $10.8 million, plunging 8.3% year over year.
Software & Services revenues (5.7%) were down 20.7% year over year to $1.8 million.
Revenues from the Americas, Europe, Middle East, and Africa region and the Asia Pacific and Japan region were $16.4 million, $9 million and $5.7 million, respectively, contributing 52.6%, 29% and 18.4% of total revenues.
Non-GAAP gross margin was 43.2%, up from 41.6% in the prior-ago quarter. The increase in gross margin is due to a favorable shift toward higher-margin system solution products.
Total operating expenses for the quarter were $15.4 million, down from $16.8 million in the year-ago quarter.
Cash Flow & Liquidity
In the six months period ended Dec. 31, 2024, LTRX generated $3 million of cash from operating activities.
As of Dec 31, 2024, the company had $19.2 million in cash and cash equivalents and $11.6 in net long-term debt compared with $26.2 million and $13.2 million as of June 30, 2024, respectively.
Outlook
For the third quarter of fiscal 2025, management projects revenues between $27 million to $31 million. Non-GAAP EPS is expected in the range of 1-5 cents.
LTRX’s Zacks Rank
LTRX currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Performance of Other Companies in Broader Tech Space
Plexus Corp PLXS reported first-quarter fiscal 2025 adjusted earnings per share of $1.73, up 40.7% year over year. The figure outpaced the Zacks Consensus Estimate of $1.59 per share.
In the past year, shares of PLXS have gained 47.1%.
Seagate Technology Holdings plc STX reported second-quarter fiscal 2025 non-GAAP earnings of $2.03 per share, beating the Zacks Consensus Estimate by 7.98%. The company reported non-GAAP earnings of 12 cents per share in the year-ago quarter.
In the past year, STX shares have gained 10.2%.
Simulations Plus, Inc. SLP reported first-quarter fiscal 2025 adjusted earnings of 17 cents per share, which declined 5.6% year over year. The figure, however, missed the Zacks Consensus Estimate of 18 cents per share.
Shares of SLP have declined 12.7% in the past year.
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