Cognex Reports Third Quarter 2024 Results
Cognex (CGNX) reported Q3 2024 financial results with revenue of $235 million, up 19% year-over-year, with 12% contribution from Moritex acquisition. Net income reached $30 million, increasing 56% from Q3-23. The company maintained strong financial position with $607 million in cash and no debt.
Revenue growth was driven by strong performance in Logistics and Semiconductor sectors, while factory automation remained soft, particularly in Automotive. Q3 operating cash flow and free cash flow reached highest levels since Q4-2022. The company expects Q4 2024 revenue between $210-230 million, with adjusted EBITDA margin of 14-17%.
Cognex (CGNX) ha riportato i risultati finanziari del terzo trimestre del 2024 con ricavi di 235 milioni di dollari, in aumento del 19% rispetto all'anno precedente, con un contributo del 12% dall'acquisizione di Moritex. L'utile netto ha raggiunto 30 milioni di dollari, aumentando del 56% rispetto al Q3-23. L'azienda ha mantenuto una solida posizione finanziaria con 607 milioni di dollari in contante e senza debiti.
La crescita dei ricavi è stata guidata da una forte performance nei settori della Logistica e dei Semiconduttori, mentre l'automazione industriale è rimasta debole, in particolare nel settore Automotive. Il flusso di cassa operativo e il flusso di cassa libero del Q3 hanno raggiunto i livelli più alti dal Q4-2022. L'azienda si aspetta ricavi per il Q4 2024 compresi tra 210-230 milioni di dollari, con un margine EBITDA rettificato del 14-17%.
Cognex (CGNX) reportó los resultados financieros del tercer trimestre de 2024 con ingresos de 235 millones de dólares, un aumento del 19% interanual, con una contribución del 12% de la adquisición de Moritex. La utilidad neta alcanzó 30 millones de dólares, aumentando un 56% desde el Q3-23. La compañía mantuvo una sólida posición financiera con 607 millones de dólares en efectivo y sin deudas.
El crecimiento de ingresos fue impulsado por un sólido desempeño en los sectores de Logística y Semiconductores, mientras que la automatización industrial se mantuvo débil, particularmente en el sector Automotriz. El flujo de caja operativo y el flujo de caja libre del Q3 alcanzaron los niveles más altos desde el Q4-2022. La compañía espera ingresos para el Q4 2024 entre 210-230 millones de dólares, con un margen EBITDA ajustado del 14-17%.
Cognex (CGNX)는 2024년 3분기 재무 결과를 발표하였으며, 매출은 2억 3500만 달러로 전년 대비 19% 증가하였고, Moritex 인수로부터의 기여는 12%였습니다. 순이익은 3000만 달러에 도달하였으며, 23년 3분기 대비 56% 증가하였습니다. 회사는 6억 700만 달러의 현금과 무부채로 강력한 재무 상태를 유지하고 있습니다.
매출 성장은 물류 및 반도체 부문의 강력한 성과에 의해 이끌어졌으며, 공장 자동화 부문은 특히 자동차 산업에서 부진했습니다. 3분기의 운영 현금 흐름 및 자유 현금 흐름은 2022년 4분기 이후 가장 높은 수준을 기록했습니다. 회사는 2024년 4분기 매출을 2억 1000만-2억 3000만 달러로 예상하며, 조정 EBITDA 마진은 14-17%로 예상하고 있습니다.
Cognex (CGNX) a annoncé les résultats financiers du troisième trimestre 2024 avec un chiffre d'affaires de 235 millions de dollars, en hausse de 19% par rapport à l'année précédente, avec une contribution de 12% de l'acquisition de Moritex. Le bénéfice net a atteint 30 millions de dollars, en augmentation de 56% par rapport au T3-23. L'entreprise a maintenu une solide position financière avec 607 millions de dollars en liquidités et sans dettes.
La croissance du chiffre d'affaires a été soutenue par de solides performances dans les secteurs de la logistique et des semi-conducteurs, tandis que l'automatisation des usines est restée faible, en particulier dans l'automobile. Le flux de trésorerie d'exploitation et le flux de trésorerie disponible du T3 ont atteint les niveaux les plus élevés depuis le T4-2022. L'entreprise prévoit un chiffre d'affaires pour le T4 2024 compris entre 210-230 millions de dollars, avec une marge EBITDA ajustée de 14-17%.
Cognex (CGNX) hat die Finanzzahlen für das 3. Quartal 2024 veröffentlicht, mit Einnahmen von 235 Millionen Dollar, was einem Anstieg von 19% im Vergleich zum Vorjahr entspricht, wobei der Beitrag der Moritex-Akquisition 12% betrug. Der Nettogewinn belief sich auf 30 Millionen Dollar und stieg um 56% im Vergleich zum Q3-23. Das Unternehmen hält eine starke finanzielle Position mit 607 Millionen Dollar in Bar und ohne Schulden.
Das Umsatzwachstum wurde durch starke Leistungen in den Bereichen Logistik und Halbleiter angetrieben, während die Fabrikautomatisierung, insbesondere im Automobilbereich, schwach blieb. Der operative Cashflow und der freie Cashflow des Q3 erreichten die höchsten Werte seit Q4-2022. Das Unternehmen erwartet für das 4. Quartal 2024 Einnahmen zwischen 210-230 Millionen Dollar bei einer bereinigten EBITDA-Marge von 14-17%.
- Revenue increased 19% YoY to $235 million
- Net income grew 56% YoY to $30 million
- Generated $56 million operating cash flow and $52 million free cash flow
- Strong balance sheet with $607 million cash and no debt
- Adjusted EPS increased 19% YoY to $0.20
- Gross margin declined to 67.9% from 72.4% YoY
- Operating expenses increased 14% YoY
- Operating income margin decreased 209 bps YoY to 13.4%
- Sequential revenue decline of 2% from Q2-24
- Softening conditions in factory automation business
Insights
The Q3 results show mixed performance with notable strengths and challenges. Revenue grew 19% year-over-year to
Concerning trends include margin pressure, with adjusted gross margin declining to
The Q4 guidance of
The divergence in segment performance is significant for market positioning. While Logistics and Semiconductor sectors show strength, the broader factory automation business faces headwinds, particularly in Automotive. This reflects broader market trends where e-commerce-driven logistics investments remain resilient while traditional manufacturing faces macro pressures.
The company's strategic focus on AI features and emerging customer initiatives demonstrates adaptation to evolving market demands. However, competitive pricing pressures noted in the Q4 outlook suggest market share battles ahead. The
"Cognex generated third quarter revenue and adjusted EBITDA margin in line with our guidance," said Robert J. Willett, CEO. "Revenue grew year-on-year on both a reported basis and excluding Moritex, led by continued strength in our Logistics and Semiconductor end markets. However, conditions across our broader factory automation business remain soft, with a further step-down in Automotive."
Mr. Willett continued, "We made good strides in innovation, rolling out additional out-of-the-box AI features that are enhancing our products. We also continue to see our Emerging Customer initiative ramp well and attract many new customers."
Dennis Fehr, CFO, added, "In this prolonged soft macro environment, we tightly managed costs and working capital. Despite a ramp in strategic investments, we delivered a sequential decrease in operating expenses. Combined with working capital efficiencies, this led to our highest quarterly operating cash flow and free cash flow since Q4-2022."
Table 1 | |||||||||
Current Q3-24 | Prior Year |
Y/Y | Prior Quarter Q2-24 |
Q/Q Change | |||||
Revenue | +19 % | -2 % | |||||||
Operating Income | +3 % | -18 % | |||||||
% of Revenue | 13.4 % | 15.5 % | (209 bps) | 16.1 % | (262 bps) | ||||
Adjusted EBITDA* | +20 % | -13 % | |||||||
% of Revenue | 17.6 % | 17.4 % | +19 bps | 19.9 % | (232 bps) | ||||
Net Income per Diluted Share | +57 % | -18 % | |||||||
Adjusted EPS (Diluted)* | +19 % | -13 % |
Note: Numbers shown may not foot due to rounding. |
*Adjusted EBITDA and Adjusted EPS (Diluted) exclude Non-GAAP adjustments. A reconciliation from GAAP to Non-GAAP metrics is provided in this news release. |
Details of the Quarter
Statement of Operations Highlights – Third Quarter of 2024
- As previously noted, results include four months of financials for Moritex, which was acquired by Cognex in October 2023, as we aligned Moritex's accounting close schedule with the Cognex close schedule in the quarter.
- Revenue grew by
19% from Q3-23. Excluding the 12 percentage point contribution to revenue growth by Moritex, revenue increased by7% . The year-on-year increase in revenue excluding Moritex was driven by strong growth in our Logistics and Semiconductor businesses as well as the timing of Consumer Electronics revenue. Sequentially, revenue decreased by2% from Q2-24, or5% excluding Moritex, primarily due to the seasonality of Consumer Electronics revenue. - Gross margin was
67.9% for Q3-24 compared to72.4% for Q3-23 and69.6% for Q2-24. We recorded in amortization of intangible assets and other acquisition charges in cost of revenue in Q3-24, primarily related to the Moritex acquisition. Adjusted gross margin was$2 million 68.7% for Q3-24 compared to72.7% for Q3-23 and70.3% for Q2-24. The year-on-year decline was primarily driven by an approximately 3 percentage point dilution effect from Moritex while negative mix and pricing contributed to the sequential decline. - Operating expenses of
increased by$128 million 14% from Q3-23 and were slightly down from Q2-24. We recorded in amortization of intangible assets, integration costs, and other acquisition charges in operating expenses in Q3-24, primarily related to the Moritex acquisition. Adjusted operating expenses of$3 million in Q3-24 increased by$125 million 10% from Q3-23 and were slightly down from Q2-24. The year-on-year increase was driven by expenses related to Moritex, our investment in the Emerging Customer initiative, and incentive compensation, partly offset by lower headcount excluding Moritex and the Emerging Customer initiative, as well as disciplined cost management. - Net Income of
increased by$30 million 56% from Q3-23 and declined by18% from Q2-24. Adjusted Net Income of in Q3-24 increased by$34 million 19% from Q3-23 and declined by13% from Q2-24. The year-on-year increase in Adjusted Net Income was primarily driven by the contribution from Moritex. - The effective tax rate was
19% in Q3-24 and30% in Q3-23. Excluding discrete tax items and the tax impact of non-GAAP adjustments, the adjusted effective tax rate was18% in both periods.
Balance Sheet and Cash Flow Highlights – September 29, 2024
- Cognex's financial position as of September 29, 2024 continued to be strong, with
in cash and investments and no debt as of September 29, 2024.$607 million - In Q3-24, Cognex generated
of cash from operating activities and$56 million in free cash flow, a$52 million and$15 million improvement year-on-year, respectively.$17 million - The company spent
to repurchase its common stock and paid$4 million in dividends to shareholders. Cognex intends to continue to repurchase shares of its common stock pursuant to its existing stock repurchase program, subject to market conditions and other relevant factors.$13 million
Financial Outlook – Fourth Quarter of 2024
- Cognex expects revenue to be between
and$210 million . This range represents a sequential decrease in revenue from Q3-24 to Q4-24 driven by Consumer Electronics seasonality and one fewer month of Moritex financials. Year-on-year, at the midpoint, this represents a low-double-digit increase on a reported basis, or a high-single-digit increase, excluding Moritex, driven by continued growth in Logistics and Semi. We expect the Moritex business to contribute 6 to 8 percent of revenue in Q4-24.$230 million - Adjusted gross margin1 is expected to be in the high 60 percent range. Mix as well as competitive pricing are expected to be sequential headwinds, partially offset by the favorable impact of one fewer month of Moritex financials.
- Adjusted EBITDA margin1 is expected to be between
14% and17% . This represents a 3 percentage point increase year-on-year at the midpoint driven by expected continued tight management of operating expenses and positive operating leverage slightly offset by lower gross margin and investment in the Emerging Customer initiative. - The adjusted effective tax rate1 is expected to be
16% .
1Cognex has provided the forward-looking non-GAAP measures of adjusted gross margin, adjusted EBITDA margin, and adjusted effective tax rate, but cannot, without unreasonable effort, forecast such items to present or provide a reconciliation to corresponding forecasted GAAP measures. These include special items such as restructuring charges, acquisition and integration charges, and amortization of acquisition-related intangible assets, all of which are subject to limitations in predictability of timing, ultimate outcome and numerous conditions outside of Cognex's control. Additionally, these items are outside of Cognex's normal business operations and not used by management to assess Cognex's operating results. Cognex believes these limitations would result in a range of projected values so broad as to not be meaningful to investors. For these reasons, Cognex believes that the probable significance of such information is low. Information with respect to special items for certain historical periods is included in the section entitled "Reconciliation of Selected Items From GAAP to Non-GAAP".
Analyst Conference Call and Simultaneous Webcast
- Cognex will host a conference call on October 31, 2024 at 8:30 a.m. Eastern Daylight Time (EDT). The telephone number is (877) 704-4573 (or (201) 389-0911 if outside
the United States ). - A real-time audio broadcast of the conference call or an archived recording, together with a slide presentation, will be accessible on the Events & Presentations page of the Cognex Investor website: www.cognex.com/investor.
COGNEX CORPORATION CONSOLIDATED BALANCE SHEETS (in thousands) | |||
September 29, | December 31, | ||
(unaudited) | |||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 197,075 | $ 202,655 | |
Current investments, amortized cost of | 90,803 | 129,392 | |
Accounts receivable, allowance for credit losses of | 157,968 | 114,164 | |
Unbilled revenue | 2,117 | 2,402 | |
Inventories | 155,278 | 162,285 | |
Prepaid expenses and other current assets | 68,841 | 68,099 | |
Total current assets | 672,082 | 678,997 | |
Non-current investments, amortized cost of | 319,287 | 244,230 | |
Property, plant, and equipment, net | 103,177 | 105,849 | |
Operating lease assets | 72,433 | 75,115 | |
Goodwill | 391,673 | 393,181 | |
Intangible assets, net | 102,550 | 112,952 | |
Deferred income taxes | 395,205 | 400,400 | |
Other assets | 6,840 | 7,088 | |
Total assets | $ 2,063,247 | $ 2,017,812 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable | $ 29,984 | $ 21,454 | |
Accrued expenses | 76,675 | 72,374 | |
Accrued income taxes | 24,226 | 16,907 | |
Deferred revenue and customer deposits | 30,045 | 31,525 | |
Operating lease liabilities | 9,806 | 9,624 | |
Total current liabilities | 170,736 | 151,884 | |
Non-current operating lease liabilities | 67,375 | 68,977 | |
Deferred income taxes | 230,368 | 246,877 | |
Reserve for income taxes | 26,491 | 26,685 | |
Non-current accrued income taxes | — | 18,338 | |
Other liabilities | 1,251 | 299 | |
Total liabilities | 496,221 | 513,060 | |
Commitments and contingencies (Note 10) | |||
Shareholders' equity: | |||
Preferred stock, | — | — | |
Common stock, | 343 | 343 | |
Additional paid-in capital | 1,076,363 | 1,037,202 | |
Retained earnings | 527,909 | 512,543 | |
Accumulated other comprehensive loss, net of tax | (37,589) | (45,336) | |
Total shareholders' equity | 1,567,026 | 1,504,752 | |
Total liabilities and shareholders' equity | $ 2,063,247 | $ 2,017,812 |
COGNEX CORPORATION CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) (In thousands, except per share amounts) | |||||||
Three-months Ended | Nine-months Ended | ||||||
September 29, | October 1, | September 29, | October 1, | ||||
Revenue | $ 234,742 | $ 197,241 | $ 684,831 | $ 640,877 | |||
Cost of revenue | 75,343 | 54,467 | 216,896 | 174,680 | |||
Gross margin | 159,399 | 142,774 | 467,935 | 466,197 | |||
Percentage of revenue | 67.9 % | 72.4 % | 68.3 % | 72.7 % | |||
Research, development, and engineering expenses | 35,210 | 32,580 | 107,277 | 104,707 | |||
Percentage of revenue | 15.0 % | 16.5 % | 15.7 % | 16.3 % | |||
Selling, general, and administrative expenses | 92,625 | 82,307 | 276,433 | 248,767 | |||
Percentage of revenue | 39.5 % | 41.7 % | 40.4 % | 38.8 % | |||
Loss (recovery) from fire | — | (2,750) | — | (5,250) | |||
Operating income | 31,564 | 30,637 | 84,225 | 117,973 | |||
Percentage of revenue | 13.4 % | 15.5 % | 12.3 % | 18.4 % | |||
Foreign currency gain (loss) | 1,221 | (8,699) | 1,086 | (9,910) | |||
Investment income | 3,561 | 4,891 | 9,797 | 12,573 | |||
Other income (expense) | 209 | 173 | 581 | 358 | |||
Income before income tax expense | 36,555 | 27,002 | 95,689 | 120,994 | |||
Income tax expense | 6,964 | 8,086 | 17,864 | 18,989 | |||
Net income | $ 29,591 | $ 18,916 | $ 77,825 | $ 102,005 | |||
Percentage of revenue | 12.6 % | 9.6 % | 11.4 % | 15.9 % | |||
Net income per weighted-average common and common-equivalent share: | |||||||
Basic | $ 0.17 | $ 0.11 | $ 0.45 | $ 0.59 | |||
Diluted | $ 0.17 | $ 0.11 | $ 0.45 | $ 0.59 | |||
Weighted-average common and common-equivalent shares outstanding: | |||||||
Basic | 171,519 | 172,169 | 171,588 | 172,408 | |||
Diluted | 172,753 | 173,354 | 172,733 | 173,659 | |||
Cash dividends per common share | $ 0.075 | $ 0.070 | $ 0.225 | $ 0.210 | |||
(1) Amounts include stock-based compensation expense, as follows: | |||||||
Cost of revenue | $ 442 | $ 435 | $ 1,460 | $ 1,497 | |||
Research, development, and engineering | 3,707 | 3,459 | 11,636 | 12,657 | |||
Selling, general, and administrative | 8,952 | 8,471 | 26,271 | 27,364 | |||
Total stock-based compensation expense | $ 13,101 | $ 12,365 | $ 39,367 | $ 41,518 | |||
Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures, including adjusted gross margin, adjusted operating expense, adjusted operating income, adjusted EBITDA, adjusted net income, adjusted earnings per share of common stock, diluted, adjusted effective tax rate, and free cash flow. Cognex defines its non-GAAP metrics as follows:
- Adjusted gross margin: Gross margin adjusted for amortization of acquisition-related intangible assets, as well as, if applicable, restructuring charges, acquisition and integration costs and other one-time discrete events, such as loss or recovery related to a fire.
- Adjusted operating expense: Operating expense adjusted for amortization of acquisition-related intangible assets, as well as, if applicable, restructuring charges, acquisition and integration costs and other one-time discrete events, such as loss or recovery related to a fire.
- Adjusted operating income: Operating income adjusted for amortization of acquisition-related intangible assets, as well as, if applicable, restructuring charges, acquisition and integration costs and other one-time discrete events, such as loss or recovery related to a fire.
- Adjusted EBITDA: Operating income adjusted for amortization of acquisition-related intangible assets and depreciation, as well as, if applicable, restructuring charges, acquisition and integration costs and other one-time discrete events, such as loss or recovery related to a fire.
- Adjusted net income: Net income adjusted for amortization of acquisition-related intangible assets, as well as, if applicable, restructuring charges, acquisition and integration costs and other one-time discrete events, such as loss or recovery related to a fire or a foreign currency (gain) loss on a forward contract to hedge the Moritex purchase price.
- Adjusted earnings per share of common stock, diluted: Adjusted net income divided by diluted weighted average common and common-equivalent shares.
- Adjusted effective tax rate: Effective tax rate adjusted for discrete tax items and the net impact of the other non-GAAP adjustments.
- Free cash flow: Cash provided by operating activities less cash for capital expenditures.
Beginning in the fourth quarter of 2023, we updated the calculation of our non-GAAP measures to exclude acquisition and integration costs and amortization of acquisition-related intangible assets. These changes have been applied retrospectively to the third quarter of 2023 and the nine month period ending October 1, 2023. Cognex also uses results on a constant-currency basis as one measure to evaluate its performance and compares results between periods as if the exchange rates had remained constant period-over-period.
Cognex believes these non-GAAP financial measures are helpful because they allow investors to more accurately compare results over multiple periods using the same methodology that management employs in its budgeting process, in its review of operating results, and for forecasting and planning for future periods. Cognex's definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Furthermore, these measures have certain limitations in that they do not include the impact of certain non-recurring expenses that are reflected in our consolidated statement of operations that are necessary to run our business. Thus, our non-GAAP financial measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.
Please see the section "Reconciliation of Selected Items from GAAP to Non-GAAP" below for more detailed information regarding non-GAAP financial measures herein, including the items reflected in our adjusted financial metrics and a description of these adjustments.
COGNEX CORPORATION RECONCILIATION OF SELECTED ITEMS FROM GAAP TO NON-GAAP Dollars in thousands, except per share amounts (Unaudited) | |||||||||
Three-months Ended | Nine-months Ended | ||||||||
September 29, | June 30, | October 1, | September 29, | October 1, | |||||
Gross margin (GAAP) | |||||||||
Acquisition and integration costs | 281 | 233 | — | 2,082 | — | ||||
Amortization of acquisition-related intangible assets | 1,640 | 1,388 | 550 | 4,457 | 1,849 | ||||
Adjusted gross margin | |||||||||
GAAP gross margin percent of revenue | 67.9 % | 69.6 % | 72.4 % | 68.3 % | 72.7 % | ||||
Adjusted gross margin percent of revenue | 68.7 % | 70.3 % | 72.7 % | 69.3 % | 73.0 % | ||||
Operating expense (GAAP) | |||||||||
(Loss) recovery from fire | — | — | 2,750 | — | 5,250 | ||||
Acquisition and integration costs | (962) | (1,203) | (1,241) | (3,468) | (1,979) | ||||
Amortization of acquisition-related intangible assets | (1,746) | (1,339) | (193) | (4,469) | (579) | ||||
Adjusted operating expense | |||||||||
Operating income (GAAP) | $ 31,564 | $ 38,457 | $ 30,637 | $ 84,225 | |||||
Loss (recovery) from fire | — | — | (2,750) | — | (5,250) | ||||
Acquisition and integration costs | 1,243 | 1,436 | 1,241 | 5,550 | 1,979 | ||||
Amortization of acquisition-related intangible assets | 3,386 | 2,727 | 743 | 8,926 | 2,428 | ||||
Adjusted operating income | $ 36,193 | $ 42,620 | $ 29,871 | $ 98,701 | |||||
GAAP operating income percent of revenue | 13.4 % | 16.1 % | 15.5 % | 12.3 % | 18.4 % | ||||
Adjusted operating income percent of revenue | 15.4 % | 17.8 % | 15.1 % | 14.4 % | 18.3 % | ||||
Depreciation (adjusted for amounts included in | 5,027 | 4,948 | 4,380 | 15,254 | 12,557 | ||||
Adjusted EBITDA | $ 41,220 | $ 47,568 | $ 34,251 | ||||||
Adjusted EBITDA margin percent of revenue | 17.6 % | 19.9 % | 17.4 % | 16.6 % | 20.2 % | ||||
Net income (GAAP) | $ 29,591 | $ 36,212 | $ 18,916 | $ 77,825 | |||||
Loss (recovery) from fire | — | — | (2,750) | — | (5,250) | ||||
Acquisition and integration costs | 1,243 | 1,436 | 1,241 | 5,550 | 1,979 | ||||
Amortization of acquisition-related intangible assets | 3,386 | 2,727 | 743 | 8,926 | 2,428 | ||||
Foreign currency (gain) loss on forward contract | — | — | 8,456 | — | 8,456 | ||||
Discrete tax (benefit) expense | 889 | (463) | 4,035 | 3,511 | 840 | ||||
Tax impact of reconciling items | (1,176) | (1,033) | (2,037) | (3,563) | (2,072) | ||||
Adjusted net income | $ 33,933 | $ 38,879 | $ 28,604 | $ 92,249 | |||||
Earnings per share of common stock, diluted (GAAP) | $ 0.17 | $ 0.21 | $ 0.11 | $ 0.45 | $ 0.59 | ||||
Loss (recovery) from fire | — | — | (0.02) | — | (0.03) | ||||
Acquisition and integration costs | 0.01 | 0.01 | 0.01 | 0.03 | 0.01 | ||||
Amortization of acquisition-related intangible assets | 0.02 | 0.02 | — | 0.05 | 0.01 | ||||
Foreign currency (gain) loss on forward contract | — | — | 0.05 | — | 0.05 | ||||
Discrete tax (benefit) expense | 0.01 | — | 0.02 | 0.02 | — | ||||
Tax impact of reconciling items | (0.01) | (0.01) | (0.01) | (0.02) | (0.01) | ||||
Adjusted earnings per share of common stock, diluted | $ 0.20 | $ 0.23 | $ 0.17 | $ 0.53 | $ 0.62 | ||||
Effective tax rate (GAAP) | 19.1 % | 12.9 % | 29.9 % | 18.7 % | 15.7 % | ||||
Discrete tax benefit (expense) | (2.4) % | 1.1 % | (14.9) % | (3.7) % | (0.7) % | ||||
Net impact of other reconciling items | 1.0 % | 1.0 % | 2.5 % | 1.3 % | 0.7 % | ||||
Adjusted effective tax rate | 17.6 % | 15.0 % | 17.5 % | 16.3 % | 15.7 % | ||||
Cash provided by operating activities (GAAP) | $ 56,271 | $ 27,763 | $ 41,023 | $ 97,677 | $ 98,425 | ||||
Capital expenditures | (4,399) | (4,510) | (5,855) | (12,970) | (16,062) | ||||
Free cash flow | $ 51,872 | $ 23,253 | $ 35,168 | $ 84,707 | $ 82,363 |
Description of adjustments:
In addition to reporting financial results in accordance with
Depreciation:
- The company incurs expense related to its normal use of property, plant and equipment.
Loss (recovery) from fire:
- On June 7, 2022, the Company's primary contract manufacturer experienced a fire at its plant in
Indonesia . During the nine-month period ended October 1, 2023, the Company recorded recoveries related to the fire of , consisting of$5,250,000 in the second quarter of 2023 for proceeds received from the Company's insurance carrier in relation to a business interruption claim and$2,500,000 in the third quarter of 2023 for proceeds received as part of a financial settlement for lost inventory and other losses incurred as a result of the fire. Management does not anticipate additional recoveries.$2,750,000
Acquisition and integration costs:
- The Company has incurred charges related to the purchase and integration of acquired businesses. During the nine-month period ended September 29, 2024, these costs were primarily related to the ongoing integration of Moritex Corporation.
Amortization of acquisition-related intangible assets:
- The Company excludes the amortization of acquired intangible assets from non-GAAP expense and income measures. These items are inconsistent in amount and frequency and are significantly impacted by the timing and size of acquisitions, and include the amortization of customer relationships, completed technologies, and trademarks that originated from prior acquisitions. The largest driver of intangible asset amortization was the acquisition of Moritex Corporation.
Discrete tax (benefit) expense:
- Items unrelated to current period ordinary income or (loss) that generally relate to changes in tax laws, adjustments to prior period's actual liability determined upon filing tax returns, adjustments to previously recorded reserves for uncertain tax positions, and initially recording or fully reversing valuation allowances.
- We estimate the tax effect of items identified in the reconciliation by applying the statutory tax rate to the pre-tax amount.
Certain statements made in this release, as well as oral statements made by the Company from time to time, constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Readers can identify these forward-looking statements by our use of the words "expects," "anticipates," "estimates," "potential," "believes," "projects," "intends," "plans," "will," "may," "shall," "could," "should," "opportunity," "goal" and similar words and other statements of a similar sense. These statements are based on our current estimates and expectations as to prospective events and circumstances, which may or may not be in our control and as to which there can be no firm assurances given. These forward-looking statements, which include statements regarding business and market trends, future financial performance and financial targets, customer demand and order rates and timing of related revenue, future product or revenue mix, research and development activities, sales and marketing activities (including our "Emerging Customer" sales initiative), new product offerings, innovation and product development activities, customer acceptance of our products, capital expenditures, cost and working capital management activities, investments, liquidity, dividends and stock repurchases, strategic and growth plans and opportunities, acquisitions, and estimated tax benefits and expenses and other tax matters, involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include: (1) the technological obsolescence of current products and the inability to develop new products, particularly in connection with emerging artificial intelligence technologies; (2) the impact of competitive pressures, including the potential decrease in demand or prices for our products; (3) the inability to attract and retain skilled employees and maintain our unique corporate culture; (4) the failure to properly manage the distribution of products and services; (5) economic, political, and other risks associated with international sales and operations, including the impact of trade disputes, the economic climate in
About Cognex Corporation
Cognex Corporation ("the Company" or "Cognex") invents and commercializes technologies that address some of the most critical manufacturing and distribution challenges. We are a leading global provider of machine vision products and solutions that improve efficiency and quality in high-growth-potential businesses across attractive industrial end markets. Our solutions blend physical products and software to capture and analyze visual information, allowing for the automation of manufacturing and distribution tasks for customers worldwide. Machine vision products are used to automate the manufacturing or distribution and tracking of discrete items, such as mobile phones, electric vehicle batteries and e-commerce packages, by locating, identifying, inspecting, and measuring them. Machine vision is important for applications in which human vision is inadequate to meet requirements for size, accuracy, or speed, or in instances where substantial cost savings or quality improvements are maintained.
Cognex is the world's leader in the machine vision industry, having shipped more than 4.5 million image-based products, representing over
Investor Contacts:
Nathan McCurren – Head of Investor Relations
Jordan Bertier – Sr. Manager, Investor Relations
Cognex Corporation
ir@cognex.com
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SOURCE Cognex Corporation
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