HLIT
$9.30
Harmonic
$.07
.76%
Earnings Details
1st Quarter March 2022
Monday, May 02, 2022 4:05:00 PM
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Summary

Harmonic Raises Guidance but Earnings Remain In-line with Estimates

Harmonic (HLIT) reported 1st Quarter March 2022 earnings of $0.01 per share on revenue of $147.4 million. The consensus estimate was a loss of $0.03 per share on revenue of $136.4 million. Revenue grew 32.1% on a year-over-year basis.

The company said it expects second quarter non-GAAP earnings of $0.07 to $0.11 per share on revenue of $144.0 million to $154.0 million. The current consensus earnings estimate is $0.07 per share on revenue of $143.90 million for the quarter ending June 30, 2022. The company also said it now expects 2022 non-GAAP earnings of $0.34 to $0.45 per share on revenue of $585.0 million to $625.0 million. The company's previous guidance was earnings of $0.26 to $0.40 per share on revenue of $570.0 million to $596.0 million and the current consensus earnings estimate is $0.35 per share on revenue of $584.44 million for the year ending December 31, 2022.

Harmonic Inc designs, manufactures and sells video products and system solutions that enable service providers to efficiently deliver the next generation of broadcast and on-demand services.

Results
Reported Earnings
$0.01
Earnings Whisper
-
Consensus Estimate
($0.03)
Reported Revenue
$147.4 Mil
Revenue Estimate
$136.4 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Harmonic Announces First Quarter 2022 Results

Revenue up 32% year over year

Cable Access revenue up 98% year over year

Record backlog and deferred revenue, up 81% year over year

SAN JOSE, Calif., May 2, 2022 /PRNewswire/ -- Harmonic Inc. (NASDAQ: HLIT) today announced its unaudited results for the first quarter of 2022.

"Harmonic delivered another strong quarter, with revenue up 32% year over year and solid operating profit, driven by Cable Access segment revenue growth of 98% and Video segment gross margin expansion," said Patrick Harshman, president and chief executive officer of Harmonic. "Robust bookings resulted in a record backlog and deferred revenue at quarter end, demonstrating continuing competitive market momentum and growth visibility."  

Q1 Financial and Business Highlights

Financial

  • Revenue: $147.4 million, up 32% year over year
    • Cable Access segment revenue: $81.6 million, up 98% year over year
    • Video segment revenue: $65.8 million, down 6% year over year
  • Gross margin: GAAP 46.9% and non-GAAP 47.3%, compared to GAAP 49.4% and non-GAAP 50.4% in the year ago period
    • Cable Access segment gross margin: 38.0% compared to 42.2% in the year ago period
    • Video segment gross margin: 58.8% compared to 55.1% in the year ago period
  • Operating income: GAAP income $2.5 million and non-GAAP income $11.3 million, compared to GAAP loss $3.8 million and non-GAAP income $5.1 million in the year ago period
  • Net income: GAAP net loss $1.5 million and non-GAAP net income of $8.9 million, compared to GAAP net loss $6.1 million and non-GAAP net income $4.5 million in the year ago period
  • Adjusted EBITDA: $14.5 million income compared to $9.1 million income in the year ago period
  • EPS: GAAP net loss per share of $0.01 and non-GAAP net income per share of $0.08, compared to GAAP net loss per share of $0.06 and non-GAAP net income per share of $0.04 in the year ago period
  • Cash: $100.7 million, relatively flat year over year

Business

  • CableOS® solution commercially deployed with 77 customers, up 45% year over year
  • CableOS deployments scaled to 6.1 million served cable modems, up 100% year over year
  • Video SaaS revenue increased 75.3% year over year

 

Select Financial Information








GAAP


Non-GAAP

Key Financial Results


Q1 2022


Q4 2021


Q1 2021


Q1 2022


Q4 2021


Q1 2021



(Unaudited, in millions, except per share data)

Net revenue


$         147.4


$         155.8


$         111.6


$         147.4


$         155.8


$         111.6

Net income (loss)


$           (1.5)


$           19.9


$           (6.1)


$             8.9


$           17.6


$             4.5

EPS


$         (0.01)


$           0.18


$         (0.06)


$           0.08


$           0.16


$           0.04










Other Financial Information

Q1 2022


Q4 2021


Q1 2021


(Unaudited, in millions)

Adjusted EBITDA for the quarter

$           14.5


$           23.8


$             9.1

Bookings for the quarter

$         205.5


$         267.3


$           96.3

Backlog and deferred revenue as of quarter end

$         497.3


$         441.0


$         274.3

Cash and cash equivalents as of quarter end

$         100.7


$         133.4


$         100.8

Explanations regarding our use of non-GAAP financial measures and related definitions, and reconciliations of our GAAP and non-GAAP measures, are provided in the sections below entitled "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations".

Financial Guidance 




 Q2 2022 GAAP Financial Guidance (1)


Low


High

(Unaudited, in millions, except
percentages)

Video


Cable Access


Adjustments (2)


Total

GAAP


Video


Cable Access


Adjustments (2)


Total

GAAP

Net revenue

$     70.0


$     74.0


$         —


$   144.0


$     74.0


$     80.0


$         —


$   154.0

Gross margin %

57.0%


42.0%


(0.4)%


48.9%


59.0%


44.0%


(0.4)%


50.8%

Gross profit

$     39.9


$     31.1


$      (0.6)


$     70.4


$     43.7


$     35.2


$       (0.6)


$     78.3

Operating expenses

$     37.0


$     24.0


$        5.1


$     66.1


$     38.0


$     26.0


$        5.1


$     69.1

Operating income (loss)

$       2.9


$       7.1


$      (5.7)


$       4.3


$       5.7


$       9.2


$       (5.7)


$       9.2

Tax expense (3)







$     (2.4)








$      (2.4)

EPS (3)







$        —








$     0.05

Shares (3)







110.8








110.8

Cash (3)







$   100.0








$   110.0

 

(1)

Components may not sum to total due to rounding.

(2)

See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

(3)

The guidance is provided at the total company level and not by segment.

 


 2022 GAAP Financial Guidance (1)


Low


High

(Unaudited, in millions, except
percentages)

Video


Cable
Access


Adjustments (2)


Total
GAAP


Video


Cable
Access


Adjustments (2)


Total
GAAP

Net revenue

$   275.0


$   310.0


$         —


$   585.0


$   287.0


$   338.0


$         —


$   625.0

Gross margin %

57.0%


42.0%


(0.6)%


48.5%


58.3%


43.4%


(0.5)%


49.7%

Gross profit

$   156.8


$   130.2


$      (3.1)


$   283.9


$   167.3


$   146.7


$       (3.1)


$   310.9

Operating expenses

$   145.0


$     93.0


$      24.3


$   262.3


$   150.0


$   101.0


$      24.3


$   275.3

Operating income (loss)

$     11.8


$     37.2


$    (27.4)


$     21.6


$     17.3


$     45.7


$     (27.4)


$     35.6

Tax expense (3)







$     (9.8)








$      (9.8)

EPS (3)







$   (0.20)








$    (0.07)

Shares (3)







104.8








104.8

Cash (3)







$   100.0








$   110.0

 

(1)

Components may not sum to total due to rounding.

(2)

See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

(3)

The guidance is provided at the total company level and not by segment.

 


Q2 2022 Non-GAAP Financial Guidance (1)


Low


High

(Unaudited, in millions, except
percentages)

Video


Cable Access


Total


Video


Cable Access


Total

Net revenue

$            70.0


$            74.0


$          144.0


$            74.0


$            80.0


$          154.0

Gross margin %

57.0%


42.0%


49.3%


59.0%


44.0%


51.2%

Gross profit

$            39.9


$            31.1


$            71.0


$            43.7


$            35.2


$            78.9

Operating expenses

$            37.0


$            24.0


$            61.0


$            38.0


$            26.0


$            64.0

Adjusted EBITDA

$              4.3


$              8.4


$            12.7


$              7.1


$            10.5


$            17.6

Tax rate (2)





13.0%






13.0%

EPS (2)





$            0.07






$            0.11

Shares (2)





110.8






110.8

Cash (2)





$          100.0






$          110.0

 

(1)

See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below. Components may not sum to total due to rounding.

(2)

The guidance is provided at the total company level and not by segment.

 


 2022 Non-GAAP Financial Guidance (1)


Low


High

(Unaudited, in millions, except
percentages)

Video


Cable Access


Total


Video


Cable Access


Total

Net revenue

$          275.0


$          310.0


$          585.0


$          287.0


$          338.0


$          625.0

Gross margin %

57.0%


42.0%


49.1%


58.3%


43.4%


50.2%

Gross profit

$          156.8


$          130.2


$          287.0


$          167.3


$          146.7


$          314.0

Operating expenses

$          145.0


$            93.0


$          238.0


$          150.0


$          101.0


$          251.0

Adjusted EBITDA

$            17.5


$            42.9


$            60.4


$            23.0


$            51.4


$            74.4

Tax rate (2)





13.0%






13.0%

EPS (2)





$            0.34






$            0.45

Shares (2)





110.8






110.8

Cash (2)





$          100.0






$          110.0

 

(1)

See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below. Components may not sum to total due to rounding.

(2)

The guidance is provided at the total company level and not by segment.

Conference Call Information

Harmonic will host a conference call to discuss its financial results at 2:00 p.m. Pacific (5:00 p.m. Eastern) on Monday, May 2, 2022. The live webcast will be available on the Harmonic Investor Relations website at http://investor.harmonicinc.com. An audio version of the webcast will be available by calling +1.574.990.1032 or +1.800.240.9147 (conference ID 2079336). A replay will be available after 5:00 p.m. PT on the same web site or by calling +1.404.537.3406 or +1.855.859.2056 (conference ID 2079336).

About Harmonic Inc.

Harmonic (NASDAQ: HLIT), the worldwide leader in virtualized cable access and video delivery solutions, enables media companies and service providers to deliver ultra-high-quality video streaming and broadcast services to consumers globally. The Company revolutionized cable access networking via the industry's first virtualized cable access solution, enabling cable operators to more flexibly deploy gigabit internet service to consumers' homes and mobile devices. Whether simplifying OTT video delivery via innovative cloud and software platforms, or powering the delivery of gigabit internet cable services, Harmonic is changing the way media companies and service providers monetize live and on-demand content on every screen. More information is available at www.harmonicinc.com.

Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements related to our expectations regarding: net revenue, gross margins, operating expenses, operating income (loss), Adjusted EBITDA, tax expense and tax rate, EPS and cash. Our expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, in no particular order, the following: the market and technology trends underlying our Video and Cable Access businesses will not continue to develop in their current direction or pace; the possibility that our products will not generate sales that are commensurate with our expectations or that our cost of revenue or operating expenses may exceed our expectations; the potential impact of the Covid-19 pandemic on our operations or the operations of our supply chain or our customers; the impact of general economic conditions on our sales and operations; the mix of products and services sold in various geographies and the effect it has on gross margins; delays or decreases in capital spending in the cable, satellite, telco, broadcast and media industries; customer concentration and consolidation; our ability to develop new and enhanced products in a timely manner and market acceptance of our new or existing products; losses of one or more key customers; risks associated with our international operations; exchange rate fluctuations of the currencies in which we conduct business; risks associated with our CableOS and VOS product solutions; dependence on various video and broadband industry trends; inventory management; the lack of timely availability or the impact of increases in the prices of parts or raw materials necessary to produce our products; the effect of competition, on both revenue and gross margins; difficulties associated with rapid technological changes in our markets; risks associated with unpredictable sales cycles; our dependence on contract manufacturers and sole or limited source suppliers; and the effect on our business of natural disasters. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in Harmonic's filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K for the year ended December 31, 2021, our most recent Quarterly Report on Form 10-Q and our Current Reports on Form 8-K. The forward-looking statements in this press release are based on information available to the Company as of the date hereof, and Harmonic disclaims any obligation to update any forward-looking statements.

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with accounting principles generally accepted in the United States ("GAAP" or referred to herein as "reported"). However, management believes that certain non-GAAP financial measures provide management and other users with additional meaningful financial information that should be considered when assessing our ongoing performance. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business, establish operating budgets, set internal measurement targets and make operating decisions.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Harmonic's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Harmonic's results of operations in conjunction with the corresponding GAAP measures.

The Company believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, the Company's reported results prepared in accordance with GAAP.

The non-GAAP measures presented here are: Gross profit, operating expenses, income (loss) from operations, non-operating expenses and net income (loss) (including those amounts as a percentage of revenue), Adjusted EBITDA and net income (loss) per diluted share. The presentation of non-GAAP information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP, and is not necessarily comparable to non-GAAP results published by other companies. A reconciliation of the historical non-GAAP financial measures discussed in this press release to the most directly comparable historical GAAP financial measures is included with the financial statements provided with this press release. The non-GAAP adjustments described below have historically been excluded from our GAAP financial measures.

Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects:

Stock-based compensation - Although stock-based compensation is a key incentive offered to our employees, we continue to evaluate our business performance excluding stock-based compensation expenses. We believe that management is limited in its ability to project the impact stock-based compensation would have on our operating results. In addition, for comparability purposes, we believe it is useful to provide a non-GAAP financial measure that excludes stock-based compensation in order to better understand the long-term performance of our core business and to facilitate the comparison of our results to the results of our peer companies. 

Amortization of intangibles - A portion of the purchase price of our acquisitions is generally allocated to intangible assets, and is subject to amortization. However, Harmonic does not acquire businesses on a predictable cycle. Additionally, the amount of an acquisition's purchase price allocated to intangible assets and the term of its related amortization can vary significantly and is unique to each acquisition. Therefore, we believe that the presentation of non-GAAP financial measures that adjust for the amortization of intangible assets provides investors and others with a consistent basis for comparison across accounting periods. 

Restructuring and related charges - Harmonic from time to time incurs restructuring charges which primarily consist of employee severance, one-time termination benefits related to the reduction of its workforce, lease exit costs, and other costs.  These charges are associated with material business shifts. We exclude these items because we do not believe they are reflective of our ongoing long-term business and operating results. 

Non-cash interest expense and other expenses related to convertible notes and other debt - We record the  amortization of issuance costs as non-cash interest expense. We believe that excluding these costs provides meaningful supplemental information regarding operational performance and liquidity, along with enhancing investors' ability to view the Company's results from management's perspective. In addition, we believe excluding these costs from the non-GAAP measures facilitates comparisons to our historical operating results and comparisons to peer company operating results. 

Discrete tax items and tax effect of non-GAAP adjustments - The income tax effect of non-GAAP adjustments relates to the tax effect of the adjustments that we incorporate into non-GAAP financial measures in order to provide a more meaningful measure of non-GAAP net income.

Depreciation - Depreciation expense, along with interest, tax and stock-based compensation expense, restructuring charges and amortization of intangible assets, is excluded from Adjusted EBITDA because we do not believe depreciation and the other items relate to the ordinary course of our business or are reflective of our underlying business performance.

 

Harmonic Inc.

Preliminary Condensed Consolidated Balance Sheets

(Unaudited, in thousands, except per share data)






April 1, 2022


December 31, 2021

ASSETS




Current assets:




     Cash and cash equivalents

$                        100,739


$                        133,431

     Accounts receivable, net

115,594


88,529

     Inventories

81,816


71,195

     Prepaid expenses and other current assets

27,251


29,972

Total current assets

325,400


323,127

Property and equipment, net

42,577


42,721

Operating lease right-of-use assets

29,556


30,968

Other non-current assets

63,281


56,657

Goodwill

239,631


240,213

Total assets

$                        700,445


$                        693,686





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




     Convertible debt, current

$                          37,518


$                          36,824

     Other debts, current

4,906


4,992

     Accounts payable

52,524


64,429

     Deferred revenue

75,474


57,226

     Operating lease liabilities, current

7,362


7,346

     Other current liabilities

53,072


53,644

Total current liabilities

230,856


224,461

Convertible debt, non-current

113,324


98,941

Other debts, non-current

12,740


12,989

Operating lease liabilities, non-current

27,689


29,120

Other non-current liabilities

31,183


31,379

Total liabilities

$                        415,792


$                        396,890





Convertible debt


883

Stockholders' equity:




       Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or
       outstanding


       Common stock, $0.001 par value, 150,000 shares authorized; 104,603 and 102,959
       shares issued and outstanding at April 1, 2022 and December 31, 2021, respectively

105


103

     Additional paid-in capital

2,362,873


2,387,039

     Accumulated deficit

(2,073,288)


(2,087,957)

     Accumulated other comprehensive loss

(5,037)


(3,272)

Total stockholders' equity

284,653


295,913

Total liabilities and stockholders' equity

$                        700,445


$                        693,686

 

Harmonic Inc.

Preliminary Condensed Consolidated Statements of Operations

(Unaudited, in thousands, except per share data)




Three Months Ended


April 1, 2022


April 2, 2021

Revenue:




     Appliance and integration

$                112,984


$                  79,976

     SaaS and service

34,455


31,600

Total net revenue

147,439


111,576

Cost of revenue:




     Appliance and integration

66,382


42,619

     SaaS and service

11,875


13,812

Total cost of revenue

78,257


56,431

Total gross profit

69,182


55,145

Operating expenses:




     Research and development

28,833


23,528

     Selling, general and administrative

36,643


34,911

     Amortization of intangibles


507

     Restructuring and related charges

1,170


43

Total operating expenses

66,646


58,989

Income (loss) from operations

2,536


(3,844)

Interest expense, net

(1,433)


(2,603)

Other income (expense), net

62


1,019

Income (loss) before income taxes

1,165


(5,428)

Provision for income taxes

2,694


696

Net loss

$                  (1,529)


$                  (6,124)





Net loss per share:




     Basic and diluted

$                    (0.01)


$                    (0.06)

Shares used in per share calculations:




     Basic and diluted

103,994


99,868

 

Harmonic Inc.

Preliminary Condensed Consolidated Statements of Cash Flows

(Unaudited, in thousands)




Three Months Ended


April 1, 2022


April 2, 2021

Cash flows from operating activities:




     Net loss

$                  (1,529)


$                  (6,124)

     Adjustments to reconcile net loss to net cash provided by (used in) operating activities:




          Depreciation

3,111


3,057

          Amortization of intangibles


507

          Stock-based compensation

7,586


8,398

          Amortization of convertible debt discount

297


1,532

          Amortization of warrant

429


429

          Foreign currency remeasurement

(563)


(2,609)

          Deferred income taxes

627


432

          Provision for expected credit losses and returns

1,348


1,089

          Provision for excess and obsolete inventories

2,738


644

          Other adjustments

77


143

          Changes in operating assets and liabilities:




               Accounts receivable

(28,479)


(20,758)

               Inventories

(11,841)


(1,119)

               Other assets

(3,949)


(1,019)

               Accounts payable

(12,260)


13,527

               Deferred revenues

18,408


11,285

               Other liabilities

(3,482)


(7,736)

Net cash provided by (used in) operating activities

(27,482)


1,678

Cash flows from investing activities:




     Purchases of property and equipment

(2,438)


(3,645)

Net cash used in investing activities

(2,438)


(3,645)

Cash flows from financing activities:




     Payments for repurchase of common stock

(2,141)


     Repayment of other debts

(99)


(108)

     Proceeds from common stock issued to employees

2,966


5,685

     Payment of tax withholding obligations related to net share settlements of restricted stock units

(2,693)


(913)

Net cash provided by (used in) financing activities

(1,967)


4,664

Effect of exchange rate changes on cash and cash equivalents

(805)


(565)

Net increase (decrease) in cash and cash equivalents

(32,692)


2,132

Cash and cash equivalents at beginning of period

133,431


98,645

Cash and cash equivalents at end of period

$                100,739


$                100,777

 

Harmonic Inc.

Preliminary GAAP Revenue Information

(Unaudited, in thousands, except percentages)



Three Months Ended


April 1, 2022


December 31, 2021


April 2, 2021

Geography









     Americas

$         103,157

70%


$         102,929

66%


$           75,062

67%

     EMEA

35,702

24%


40,096

26%


27,607

25%

     APAC

8,580

6%


12,779

8%


8,907

8%

Total

$         147,439

100%


$         155,804

100%


$         111,576

100%










Market









     Service Provider

$           92,521

63%


$           87,263

56%


$           53,660

48%

     Broadcast and Media

54,918

37%


68,541

44%


57,916

52%

Total

$         147,439

100%


$         155,804

100%


$         111,576

100%

 

Harmonic Inc.

Preliminary Segment Information

(Unaudited, in thousands, except percentages)



Three Months Ended April 1, 2022


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated
GAAP Measures

Net revenue

$        65,842


$        81,597


$      147,439


$                  —


$      147,439

Gross profit

38,684


31,011


69,695


(513)


69,182

Gross margin %

58.8%


38.0%


47.3%




46.9%

Operating income

3,139


8,139


11,278


(8,742)


2,536

Operating margin %

4.8%


10.0%


7.6%




1.7%












Three Months Ended December 31, 2021


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated
GAAP Measures

Net revenue

$        86,092


$        69,712


$      155,804


$                  —


$      155,804

Gross profit

50,589


28,080


78,669


(731)


77,938

Gross margin %

58.8%


40.3%


50.5%




50.0%

Operating income

15,225


5,408


20,633


(5,487)


15,146

Operating margin %

17.7%


7.8%


13.2%




9.7%












Three Months Ended April 2, 2021


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated
GAAP Measures

Net revenue

$        70,331


$        41,245


$      111,576


$                  —


$      111,576

Gross profit

38,774


17,408


56,182


(1,037)


55,145

Gross margin %

55.1%


42.2%


50.4%




49.4%

Operating income (loss)

3,772


1,296


5,068


(8,912)


(3,844)

Operating margin %

5.4%


3.1%


4.5%




(3.4)%

 

(1)

See "Use of Non-GAAP Financial Measures" above and "GAAP to Non-GAAP Reconciliations" below.

 

Harmonic Inc.

GAAP to Non-GAAP Reconciliations (Unaudited)

(in thousands, except percentages and per share data)




Three Months Ended April 1, 2022


Revenue


Gross Profit


Total Operating Expense


Income  from Operations


Total Non-
operating
expense, net


Net Income (loss)

GAAP

$      147,439


$     69,182


$     66,646


$       2,536


$     (1,371)


$      (1,529)

     Stock-based compensation


527


(7,059)


7,586



7,586

     Restructuring and related charges


(14)


(1,170)


1,156



1,156

     Non-cash interest and other expenses related to convertible
     notes





297


297

     Discrete tax items and tax effect of non-GAAP adjustments






1,367

Total adjustments


513


(8,229)


8,742


297


10,406

Non-GAAP

$      147,439


$     69,695


$     58,417


$     11,278


$     (1,074)


$       8,877

As a % of revenue (GAAP)



46.9%


45.2%


1.7%


(0.9)%


(1.0)%

As a % of revenue (Non-GAAP)



47.3%


39.6%


7.6%


(0.7)%


6.0%

Diluted net income (loss) per share:












     GAAP











$       (0.01)

     Non-GAAP











$        0.08

Shares used in per share calculation:












     GAAP











103,994

     Non-GAAP











110,563

 


Three Months Ended December 31, 2021


Revenue


Gross Profit


Total
Operating
Expense


Income
from
Operations


Total Non-
operating
expense, net


Net Income

GAAP

$      155,804


$     77,938


$     62,792


$     15,146


$      (2,678)


$     19,857

     Stock-based compensation


506


(4,689)


5,195



5,195

     Restructuring and related charges


225


(67)


292



292

     Non-cash interest and other expenses related to convertible
     notes





1,621


1,621

     Discrete tax items and tax effect of non-GAAP adjustments






(9,347)

Total adjustments


731


(4,756)


5,487


1,621


(2,239)

Non-GAAP

$      155,804


$     78,669


$     58,036


$     20,633


$      (1,057)


$     17,618

As a % of revenue (GAAP)



50.0%


40.3%


9.7%


(1.7)%


12.7%

As a % of revenue (Non-GAAP)



50.5%


37.2%


13.2%


(0.7)%


11.3%

Diluted net income per share:












     GAAP











$        0.18

     Non-GAAP











$        0.16

Shares used in per share calculation:












     GAAP and Non-GAAP











110,474

 


Three Months Ended April 2, 2021


Revenue


Gross Profit


Total
Operating
Expense


Income
(Loss) from
Operations


Total Non-
operating
expense, net


Net Income (Loss)

GAAP

$      111,576


$     55,145


$     58,989


$      (3,844)


$      (1,584)


$      (6,124)

     Stock-based compensation


1,073


(7,325)


8,398



8,398

     Amortization of intangibles



(507)


507



507

     Restructuring and related charges


(36)


(43)


7



7

     Non-cash interest and other expenses related to convertible
     notes





1,532


1,532

Discrete tax items and tax effect of non-GAAP adjustments






194

Total adjustments


1,037


(7,875)


8,912


1,532


10,638

Non-GAAP

$      111,576


$     56,182


$     51,114


$       5,068


$          (52)


$       4,514

As a % of revenue (GAAP)



49.4%


52.9%


(3.4)%


(1.4)%


(5.5)%

As a % of revenue (Non-GAAP)



50.4%


45.8%


4.5%


—%


4.0%

Diluted net income (loss) per share:












     GAAP











$       (0.06)

     Non-GAAP











$        0.04

Shares used in per share calculation:












     GAAP











99,868

     Non-GAAP











103,190

 

Harmonic Inc.

Preliminary Adjusted EBITDA Reconciliation (Unaudited)

(In thousands)




Three Months Ended


April 1, 2022


December 31, 2021


April 2, 2021

Net income (loss) - GAAP

$                    (1,529)


$                   19,857


$                    (6,124)

     Provision for income taxes

2,694


(7,389)


696

     Interest expense, net

1,433


2,706


2,603

     Depreciation

3,111


3,151


3,057

     Amortization of intangibles



507

EBITDA

5,709


18,325


739







Adjustments






     Stock-based compensation

7,586


5,195


8,398

     Restructuring and related charges

1,156


292


7

Adjusted EBITDA

$                   14,451


$                   23,812


$                     9,144

 

Harmonic Inc.

GAAP to Non-GAAP Reconciliations on Financial Guidance (Unaudited)

(In millions, except percentages and per share data)




Q2 2022 Financial Guidance (1)


Revenue


Gross Profit


Income from
Operations


Net Income

GAAP

$144.0

to   

$154.0


$70.4

to   

$78.3


$4.3

to   

$9.2


$0.3

to   

$5.2

     Stock-based compensation expense


0.4


5.2


5.2

     Restructuring and related charges


0.2


0.5


0.5

     Non-cash interest and other expenses related to convertible notes




0.3

     Tax effect of non-GAAP adjustments




1.3

to   

0.6

Total adjustments


0.6


5.7


7.3

to   

6.6

Non-GAAP

$144.0

to   

$154.0


$71.0

to   

$78.9


$10.0

to   

$14.9


$7.6

to   

$11.8

     As a % of revenue (GAAP)





48.9%

to   

50.8%


3.0%

to   

5.9%


0.2%

to   

3.4%

     As a % of revenue (Non-GAAP)





49.3%

to   

51.2%


6.9%

to   

9.6%


5.3%

to   

7.6%

Diluted net income per share:
















     GAAP













$—

to   

$0.05

     Non-GAAP













$0.07

to   

$0.11

Shares used in per share calculation:
















     GAAP and Non-GAAP













110.8

 

(1)

Components may not sum to total due to rounding.

 


2022 Financial Guidance (1)


Revenue


Gross Profit


Income from
Operations


Net Income (Loss)

GAAP

$585.0

to   

$625.0


$283.9

to   

$310.9


$21.6

to   

$35.6


$(21.1)

to   

$(7.0)

     Stock-based compensation expense


1.8


24.8


24.8

     Restructuring and related charges


1.3


2.6


2.6

     Non-cash interest and other expenses related to convertible notes




27.6

     Tax effect of non-GAAP adjustments




4.1

to   

2.3

Total adjustments


3.1


27.4


59.1

to   

57.3

Non-GAAP

$585.0

to   

$625.0


$287.0

to   

$314.0


$49.0

to   

$63.0


$38.1

to   

$50.3

     As a % of revenue (GAAP)





48.5%

to   

49.7%


3.7%

to   

5.7%


(3.6)%

to   

(1.1)%

     As a % of revenue (Non-GAAP)





49.1%

to   

50.2%


8.4%

to   

10.1%


6.5%

to   

8.1%

Diluted net income (loss) per share:
















     GAAP













$(0.20)

to   

$(0.07)

     Non-GAAP













$0.34

to   

$0.45

Shares used in per share calculation:
















     GAAP













104.8

     Non-GAAP













110.8

 

(1)

Components may not sum to total due to rounding.

 

Harmonic Inc.

Adjusted EBITDA Reconciliation on Financial Guidance (Unaudited)(1)

(In millions)






Q2 2022 Financial
Guidance


2022 Financial
Guidance

Net income (loss) - GAAP

$0.3

to

$5.2


$(21.1)

to   

$(7.0)

     Provision for income taxes



2.4




9.8

     Interest expense, net



1.3




4.9

     Depreciation



3.0




12.8

EBITDA

$7.0

to

$11.9


$6.4

to   

$20.5









Adjustments








     Stock-based compensation



5.2




24.8

     Loss on debt conversion






26.5

     Restructuring and related charges



0.5




2.6

Adjusted EBITDA

$12.7

to

$17.6


$60.4

to   

$74.4

 

(1)

Components may not sum to total due to rounding.

 

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SOURCE Harmonic Inc.