RADCOM Delivers Strong First Quarter Results with 17.5% Y-o-Y Revenue Growth
RADCOM (NASDAQ: RDCM) has announced strong financial results for Q1 2024, with revenues reaching $14.1 million, marking a 17.5% year-over-year growth from $12 million in Q1 2023. The company reported a GAAP net income of $0.8 million ($0.05 per diluted share) and a non-GAAP net income of $2.8 million ($0.18 per diluted share). As of March 31, 2024, RADCOM had $85.3 million in cash and no debt, achieving its highest-ever cash level. RADCOM also renewed its multi-year contract with Rakuten Mobile and extended a contract with a U.S. telecom operator to use RADCOM ACE. The company raised its 2024 revenue guidance to $57-$60 million.
- Revenue for Q1 2024 increased by 17.5% year-over-year to $14.1 million.
- GAAP net income for Q1 2024 was $0.8 million ($0.05 per diluted share), up from $0.6 million ($0.04 per diluted share) in Q1 2023.
- Non-GAAP net income for Q1 2024 was $2.8 million ($0.18 per diluted share), up from $1.8 million ($0.12 per diluted share) in Q1 2023.
- The company achieved its highest-ever cash level of $85.3 million with no debt.
- Renewed multi-year contract with Rakuten Mobile, including AI-powered analytics.
- Extended contract with a U.S. telecom operator to use RADCOM ACE on Amazon Web Services.
- Raised lower end of 2024 revenue guidance to $57-$60 million from $56-$60 million.
- The press release does not provide specific details on any increase in expenses or costs related to new contracts.
- There is no mention of new customer acquisitions beyond existing contract renewals, which may indicate a reliance on current clients for revenue growth.
Insights
RADCOM's 17.5% year-over-year revenue growth is a noteworthy achievement. This indicates a strong demand for their products and services. From a financial perspective, the company has demonstrated effective management by not only increasing revenues but also maintaining profitability.
The company's cash reserves of
One potential drawback could be the reliance on key contracts such as those with Rakuten Mobile and the U.S. telecom operator. While these extensions are positive, over-reliance on a few major clients can be risky if these relationships were to change negatively.
Overall, the financial performance is strong and suggests a well-managed company, making it a positive signal for investors.
The extension of the multi-year contract with Rakuten Mobile and the U.S. telecom operator is significant. It not only secures future revenue streams but also reflects confidence in RADCOM's AI-powered analytics and operational capabilities. This is an endorsement of their technology and service quality, which can attract more clients and strengthen their market position.
From a market perspective, RADCOM's ability to adapt and offer its services via Amazon Web Services (AWS) as Software-as-a-Service (SaaS) is a strategic move. The shift towards SaaS models is a trend in the industry, providing scalability, recurring revenue and easier adoption for clients. This positions RADCOM well in the competitive landscape, appealing to a broader range of customers, including those looking to minimize upfront infrastructure costs.
The company's guidance increase for the lower end of 2024 revenue to
However, the competitive landscape in telecom analytics is intense and maintaining growth with new and innovative offerings will be essential to sustain momentum.
Continues its Strategy for Profitable Growth
Achieves Highest Ever Company Cash Level of
First Quarter 2024 Financial Highlights:
- Total revenues for the first quarter were
$14.1 million $12.0 million 17.5% year-over-year growth. - GAAP net income for the first quarter was
$0.8 million $0.05 $0.6 million $0.04 - Non-GAAP net income for the period was
$2.8 million $0.18 $1.8 million $0.12 - As of March 31, 2024, the Company had cash, cash equivalents, and short-term bank deposits of
$85.3 million
Management Comments:
Hilik Itman, RADCOM's Interim Chief Executive Officer, commented on the results: "We continued our positive momentum from 2023 into 2024 with a revenue increase of
Mr. Itman continued, "We have renewed our multi-year contract with Rakuten Mobile, extending our collaboration and strengthening our partnership with this innovative operator in
He added, "Also, a
Mr. Itman concluded, "Based on our current visibility, sales engagements, and overall market opportunity, we remain well-positioned to deliver on our customer commitments, drive the business forward to deliver a fifth consecutive year of revenue growth, and increase our profitability.
This gives us the confidence to raise the lower end of our 2024 revenue guidance to
Earnings Conference Call
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. To join the interactive call, please call one of the following numbers 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 live webcast of the presentation will be available at https://veidan.activetrail.biz/radcomq1-2024. The webcast will be archived for 90 days following the live presentation.
For those unable to listen to the call, a replay will be available a few hours later in the investor relations section on the Company's website at https://radcom.com/investor-relations/.
For all investor inquiries, please contact:
Investor Relations:
Miri Segal
MS-IR LLC
917-607-8654
msegal@ms-ir.com
Company Contact:
Hadar Rahav
CFO
+972-77-7745062
hadar.rahav@radcom.com
About RADCOM
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 and expectations regarding delivering on customer commitments, driving the business forward to deliver revenue growth, and increasing profitability, 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
RADCOM Ltd. | |||
Consolidated Statements of Operations | |||
Unaudited | |||
(thousands of | |||
Three months ended | |||
March 31, | |||
2024 | 2023 | ||
Revenues | $ 14,123 | $ 12,023 | |
Cost of revenues | 3,751 | 3,348 | |
Gross profit | 10,372 | 8,675 | |
Research and development, gross | 4,593 | 4,769 | |
Less - royalty-bearing participation | 209 | 262 | |
Research and development, net | 4,384 | 4,507 | |
Sales and marketing | 4,285 | 3,313 | |
General and administrative | 2,013 | 1,229 | |
Total operating expenses | 10,682 | 9,049 | |
Operating loss | (310) | (374) | |
Financial income, net | 1,105 | 1,026 | |
Income before taxes on income | 795 | 652 | |
Taxes on income | (33) | (31) | |
Net income | $ 762 | $ 621 | |
Basic and diluted net income per | $ 0.05 | $ 0.04 | |
ordinary share | |||
15,427,514 | 14,891,425 | ||
Weighted average number of | |||
ordinary shares used in computing basic net income per ordinary share | |||
Weighted average number of | 15,866,910 | 15,569,410 | |
ordinary shares used in computing diluted net income per ordinary share | |||
RADCOM LTD. | |||
Reconciliation of GAAP to Non-GAAP Financial Information | |||
Unaudited | |||
(thousands of | |||
Three months ended | |||
March 31, | |||
2024 | 2023 | ||
GAAP gross profit | $ 10,372 | $ 8,675 | |
Stock-based compensation | 84 | 89 | |
Amortization of intangible assets | 56 | - | |
Non-GAAP gross profit | $ 10,512 | $ 8,764 | |
$ 4,384 | $ 4,507 | ||
GAAP research and development, net | |||
Stock-based compensation | 537 | 545 | |
Non-GAAP research and development, net | $ 3,847 | $ 3,962 | |
$ 4,285 | $ 3,313 | ||
GAAP sales and marketing | |||
Stock-based compensation | 504 | 308 | |
Amortization of intangible assets | 29 | - | |
Non-GAAP sales and marketing | $ 3,752 | $ 3,005 | |
$ 2,013 | $ 1,229 | ||
GAAP general and administrative | |||
Stock-based compensation | 839 | 265 | |
Non-GAAP general and administrative | $ 1,174 | $ 964 | |
$ 10,682 | $ 9,049 | ||
GAAP total operating expenses | |||
Stock-based compensation | 1,880 | 1,118 | |
Amortization of intangible assets | 29 | - | |
Non-GAAP total operating expenses | $ 8,773 | $ 7,931 | |
$ (310) | $ (374) | ||
GAAP operating loss | |||
Stock-based compensation | 1,964 | 1,207 | |
Amortization of intangible assets | 85 | - | |
Non-GAAP operating income | $ 1,739 | $ 833 | |
$ 795 | $ 652 | ||
GAAP income before taxes on income | |||
Stock-based compensation | 1,964 | 1,207 | |
Amortization of intangible assets | 85 | - | |
Financial expenses | 37 | - | |
Non-GAAP income before taxes on income | $ 2,881 | $ 1,859 | |
$ 762 | $ 621 | ||
GAAP net income | |||
Stock-based compensation | 1,964 | 1,207 | |
Amortization of intangible assets | 85 | - | |
Financial expenses | 37 | - | |
Non-GAAP net income | $ 2,848 | $ 1,828 | |
$ 0.05 | $ 0.04 | ||
GAAP net income per diluted share | |||
Stock-based compensation | 0.12 | 0.08 | |
Amortization of intangible assets | 0.01 | - | |
Financial expenses | (*) | - | |
Non-GAAP net income per diluted share | $ 0.18 | $ 0.12 | |
Weighted average number of shares used to compute diluted net income per share | 15,866,910 | 15,569,410 | |
(*) Less than | |||
RADCOM Ltd. | |||
Consolidated Balance Sheets | |||
(thousands of | |||
As of | As of | ||
March 31, | December 31, | ||
2024 | 2023 | ||
Current Assets | |||
Cash and cash equivalents | $ 8,139 | $ 10,892 | |
Short-term bank deposits | 77,126 | 71,273 | |
Trade receivables, net | 14,829 | 13,412 | |
Inventories | 975 | 246 | |
Other accounts receivable and prepaid expenses | 1,469 | 1,592 | |
102,538 | 97,415 | ||
Total Current Assets | |||
Non-Current Assets | |||
Severance pay fund | 3,118 | 3,142 | |
Other long-term receivables | 1,209 | 1,573 | |
Property and equipment, net | 787 | 798 | |
Operating lease right-of-use assets | 1,373 | 1,651 | |
Goodwill and intangible assets, net | 2,865 | 2,950 | |
9,352 | 10,114 | ||
Total Non-Current Assets | |||
Total Assets | $ 111,890 | $ 107,529 | |
Liabilities and Shareholders' Equity | |||
Current Liabilities | |||
Trade payables | $ 3,677 | $ 2,640 | |
Deferred revenues and advances from customers | 2,986 | 1,469 | |
Employee and payroll accruals | 4,911 | 5,400 | |
Operating lease liabilities | 838 | 1,062 | |
Other liabilities and accrued expenses | 9,213 | 9,540 | |
21,625 | 20,111 | ||
Total Current Liabilities | |||
Non-Current Liabilities | |||
Accrued severance pay | 3,780 | 3,728 | |
Operating lease liabilities | 490 | 561 | |
Other liabilities and accrued expenses | 671 | 638 | |
4,941 | 4,927 | ||
Total Non-Current Liabilities | |||
Total Liabilities | $ 26,566 | $ 25,038 | |
Shareholders' Equity | |||
Share capital | $ 747 | $ 736 | |
Additional paid-in capital | 156,651 | 154,697 | |
Accumulated other comprehensive loss | (2,924) | (3,030) | |
Accumulated deficit | (69,150) | (69,912) | |
Total Shareholders' Equity | 85,324 | 82,491 | |
$ 111,890 | $ 107,529 | ||
Total Liabilities and Shareholders' Equity | |||
View original content:https://www.prnewswire.com/news-releases/radcom-delivers-strong-first-quarter-results-with-17-5-y-o-y-revenue-growth-302146143.html
SOURCE RADCOM Ltd.
FAQ
What were RADCOM's Q1 2024 revenues?
What is RADCOM's stock symbol?
What was RADCOM's GAAP net income for Q1 2024?
What was RADCOM's non-GAAP net income for Q1 2024?
What is RADCOM's revenue guidance for 2024?
How much cash did RADCOM have at the end of Q1 2024?
Did RADCOM renew any major contracts recently?
