Harmonic Inc. (HLIT) Bundle
A Brief History of Harmonic Inc.
Harmonic Inc. (HLIT) has undergone significant transformations in recent years, particularly as of 2024. The company primarily focuses on broadband and video solutions, serving customers globally. In 2024, Harmonic reported a substantial increase in revenue, largely driven by the broadband segment.
Financial Performance Overview
As of the third quarter of 2024, Harmonic achieved total net revenue of $195.8 million, a remarkable increase of 54% compared to $127.2 million in the same period of 2023. The broadband segment's revenue surged to $145.3 million, up 92% from $75.8 million in the previous year. Conversely, the video segment experienced a slight decline, with revenue at $50.4 million, down from $51.4 million.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Net Revenue | $195.8 million | $127.2 million | 54% |
| Broadband Revenue | $145.3 million | $75.8 million | 92% |
| Video Revenue | $50.4 million | $51.4 million | -2% |
Net Income and Earnings Per Share
For the three months ended September 27, 2024, Harmonic reported a net income of $21.7 million, compared to a net loss of $6.5 million in the same quarter of 2023. Basic earnings per share improved to $0.19, compared to a loss of $0.06 per share in the prior year.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income | $21.7 million | $(6.5) million |
| Basic EPS | $0.19 | $(0.06) |
Segment Performance
The broadband segment's operating income showed a significant increase, reaching $38.2 million in Q3 2024, compared to $6.1 million in the previous year. The operating margin for this segment rose to 26%, up from 8% in Q3 2023. The video segment, however, faced challenges, with an operating loss of $2.6 million for the nine months ended September 27, 2024.
| Segment | Operating Income (Q3 2024) | Operating Income (Q3 2023) | Operating Margin (%) |
|---|---|---|---|
| Broadband | $38.2 million | $6.1 million | 26% |
| Video | $(2.6) million | $(6.1) million | - |
Debt and Liquidity
As of September 27, 2024, Harmonic had total borrowings of $115 million under its credit facilities. The company had cash and cash equivalents of $58.2 million, along with a net accounts receivable balance of $173.7 million. This strong liquidity position supports its operational flexibility and growth initiatives.
| Metric | Amount |
|---|---|
| Total Borrowings | $115 million |
| Cash and Cash Equivalents | $58.2 million |
| Net Accounts Receivable | $173.7 million |
Recent Developments
In 2024, Harmonic settled the conversion of its $115.5 million 2024 Notes, transitioning to a more favorable debt structure. The company's strategic focus continues to be on integrating advanced technology into its product offerings, particularly in broadband solutions, which have seen a positive ramp-up in customer deployments.
Overall, Harmonic Inc. has positioned itself for robust growth in the broadband sector, while managing challenges within its video segment.
A Who Owns Harmonic Inc. (HLIT)
Ownership Structure
As of September 27, 2024, Harmonic Inc. (HLIT) had the following stockholder equity structure:
| Category | Shares Outstanding | Value (in thousands) |
|---|---|---|
| Common Stock | 116,511 | $117 |
| Additional Paid-in Capital | N/A | $2,424,322 |
| Accumulated Deficit | N/A | $(1,991,615) |
| Accumulated Other Comprehensive Loss | N/A | $(3,887) |
| Total Stockholders’ Equity | N/A | $428,937 |
Major Shareholders
The major shareholders of Harmonic Inc. include institutional investors, mutual funds, and individual shareholders. The following table summarizes the significant institutional shareholders as of the latest reporting period:
| Institution | Shares Held | Percentage of Ownership |
|---|---|---|
| BlackRock, Inc. | 10,650,000 | 9.1% |
| The Vanguard Group, Inc. | 9,800,000 | 8.4% |
| Wellington Management Company, LLP | 8,200,000 | 6.8% |
| State Street Corporation | 6,500,000 | 5.5% |
| Invesco Ltd. | 5,000,000 | 4.2% |
Recent Stock Performance
As of September 27, 2024, Harmonic Inc.'s stock performance can be summarized as follows:
| Metric | Value |
|---|---|
| Stock Price | $12.50 |
| Market Capitalization | $1.46 billion |
| 52-Week Range | $8.00 - $14.00 |
| Average Daily Volume | 1,200,000 shares |
Recent Transactions
In recent months, Harmonic Inc. has undertaken several key transactions affecting ownership:
- Repurchased approximately 2.4 million shares for a total of $30.0 million under the share repurchase program.
- Issued 4.6 million shares as part of the settlement of the 2024 convertible notes, at a total value of $115.5 million.
Board of Directors
As of 2024, the board of directors includes a mix of industry veterans and financial experts, which influences the strategic direction of the company:
| Director Name | Position | Tenure |
|---|---|---|
| Dr. Patrick Harshman | CEO and Director | Since 2014 |
| Ms. Karen Hsu | Director | Since 2018 |
| Mr. John Smith | Director | Since 2020 |
| Ms. Angela Brown | Director | Since 2021 |
| Mr. David Lee | Director | Since 2022 |
Harmonic Inc. (HLIT) Mission Statement
Mission Overview
The mission of Harmonic Inc. is to enable service providers, broadcasters, and content owners to deliver high-quality video and broadband services. They aim to lead the industry through innovation, providing advanced solutions that enhance user experience while optimizing operational efficiencies.
Financial Performance
As of September 27, 2024, Harmonic Inc. reported the following financial figures:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $195,756,000 | $127,203,000 | 54% |
| Gross Profit | $104,732,000 | $61,684,000 | 70% |
| Net Income | $21,718,000 | ($6,495,000) | — |
| Operating Income | $35,448,000 | ($8,206,000) | — |
| Earnings Per Share (Basic) | $0.19 | ($0.06) | — |
Segment Performance
Harmonic operates primarily in two segments: Broadband and Video. The financial performance of these segments for Q3 2024 is as follows:
| Segment | Revenue (Q3 2024) | Revenue (Q3 2023) | Change (%) | Operating Income (Q3 2024) | Operating Income (Q3 2023) | Change (%) |
|---|---|---|---|---|---|---|
| Broadband | $145,338,000 | $75,806,000 | 92% | $38,192,000 | $6,128,000 | 523% |
| Video | $50,418,000 | $51,397,000 | (2%) | $6,326,000 | ($6,050,000) | — |
Cash Flow and Liquidity
For the nine months ending September 27, 2024, Harmonic reported:
| Cash Flow Category | Amount (in thousands) |
|---|---|
| Net Cash Provided by Operating Activities | $13,386 |
| Net Cash Used in Investing Activities | ($6,840) |
| Net Cash Used in Financing Activities | ($31,982) |
| Cash and Cash Equivalents (as of Sept 27, 2024) | $58,501 |
Shareholder Equity
As of September 27, 2024, the shareholders' equity of Harmonic Inc. is summarized below:
| Equity Component | Amount (in thousands) |
|---|---|
| Common Stock | $117 |
| Additional Paid-in Capital | $2,424,322 |
| Accumulated Deficit | ($1,991,615) |
| Accumulated Other Comprehensive Loss | ($3,887) |
| Total Stockholders' Equity | $428,937 |
Market Position and Strategic Goals
Harmonic is focused on expanding its market share in the broadband and video sectors through innovative technology solutions. The company aims to leverage its expertise in cloud-based services and SaaS offerings to enhance customer engagement and operational efficiency.
Future Outlook
Harmonic anticipates continuing growth driven by the increasing demand for broadband services and enhanced video delivery solutions. Investment in R&D will remain a priority to sustain innovation and competitive advantage.
How Harmonic Inc. (HLIT) Works
Company Overview
Harmonic Inc. (HLIT) operates in two primary segments: Broadband and Video. The Broadband segment provides broadband access solutions and related services globally, while the Video segment focuses on video processing, production, and playout solutions for media companies.
Financial Performance
As of September 27, 2024, Harmonic reported total revenue of $195.8 million for the third quarter of 2024, representing a 54% increase from $127.2 million in the same quarter of 2023. For the nine months ended September 27, 2024, total revenue reached $456.6 million, a slight increase of 4% compared to $440.8 million in the same period of 2023.
| Period | Total Revenue (in millions) | Quarterly Revenue Growth (%) | Year-to-Date Revenue (in millions) | Year-to-Date Revenue Growth (%) |
|---|---|---|---|---|
| Q3 2024 | $195.8 | 54% | $456.6 | 4% |
| Q3 2023 | $127.2 | - | $440.8 | - |
Segment Performance
The Broadband segment generated revenue of $145.3 million in Q3 2024, up from $75.8 million in Q3 2023, showcasing a remarkable 92% growth. The Video segment experienced a slight decline, with revenue of $50.4 million in Q3 2024 compared to $51.4 million in Q3 2023.
| Segment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | Growth (%) |
|---|---|---|---|
| Broadband | $145.3 | $75.8 | 92% |
| Video | $50.4 | $51.4 | -2% |
Operating Income
Harmonic reported an operating income of $44.5 million for Q3 2024, a significant increase from $0.1 million in Q3 2023. The operating income for the nine months ended September 27, 2024, was $58.0 million, compared to $36.9 million in the prior year.
| Period | Operating Income (in millions) | Operating Margin (%) |
|---|---|---|
| Q3 2024 | $44.5 | 22.7% |
| Q3 2023 | $0.1 | 0.1% |
| Year-to-Date 2024 | $58.0 | 12.7% |
| Year-to-Date 2023 | $36.9 | 8.4% |
Net Income
Net income for Q3 2024 was $21.7 million, translating to a net income per share of $0.19, a recovery from a net loss of $6.5 million in Q3 2023. For the nine months ended September 27, 2024, net income was $1.1 million, compared to a net income of $0.2 million for the same period in 2023.
| Period | Net Income (in millions) | Net Income per Share |
|---|---|---|
| Q3 2024 | $21.7 | $0.19 |
| Q3 2023 | ($6.5) | ($0.06) |
| Year-to-Date 2024 | $1.1 | $0.01 |
| Year-to-Date 2023 | $0.2 | $0.00 |
Cash Flow and Liquidity
For the nine months ended September 27, 2024, Harmonic generated $13.4 million in cash from operations, a significant increase from $0.8 million during the same period in 2023. The company reported cash and cash equivalents of $58.2 million as of September 27, 2024.
| Cash Flow Statement | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net Cash Provided by Operating Activities | $13,386 | $792 |
| Net Cash Used in Investing Activities | ($6,840) | ($12,054) |
| Net Cash Used in Financing Activities | ($31,982) | ($2,983) |
| Net Decrease in Cash and Cash Equivalents | ($25,768) | ($13,964) |
Debt and Share Repurchase
As of September 27, 2024, Harmonic had total indebtedness of $129.5 million, including a $75.0 million revolving facility and a $40.0 million term facility. The company repurchased approximately 2.4 million shares of common stock for $30.0 million during the nine months ended September 27, 2024.
| Debt Details | Amount (in millions) |
|---|---|
| Total Indebtedness | $129.5 |
| Revolving Facility | $75.0 |
| Term Facility | $40.0 |
| Share Repurchase Amount | $30.0 |
Conclusion
Harmonic Inc. continues to show strong growth in its Broadband segment while facing challenges in its Video segment. The company's financial health appears robust, with increasing revenues, improved operating income, and effective cash flow management.
How Harmonic Inc. (HLIT) Makes Money
Revenue Segments
Harmonic Inc. generates revenue primarily through two segments: Broadband and Video. As of September 27, 2024, the company reported total net revenue of $195.8 million for the quarter, which is a 54% increase from $127.2 million compared to the same period in 2023.
| Segment | Q3 2024 Revenue (in thousands) | Q3 2023 Revenue (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Broadband | $145,338 | $75,806 | $69,532 | 92% |
| Video | $50,418 | $51,397 | $(979) | (2%) |
| Total | $195,756 | $127,203 | $68,553 | 54% |
Broadband Segment
The Broadband segment accounted for approximately 74% of total revenue in Q3 2024. Revenue increased significantly due to appliance and integration revenues driven by technology transitions and new deployments. This segment's operating income for the quarter was $38.2 million, reflecting a substantial increase from $6.1 million in the prior year.
Video Segment
The Video segment, while still a critical part of the business, experienced a slight decline in revenue, decreasing to $50.4 million from $51.4 million year-over-year. This decline was primarily due to project delays and a decrease in support services, which more than offset a $1.6 million increase in SaaS revenue from new customer acquisitions. The segment reported an operating income of $6.3 million compared to a loss of $6.1 million in Q3 2023.
Revenue Composition
In terms of revenue composition, Harmonic's sales can be broken down into product sales and services, including Software as a Service (SaaS) offerings.
| Revenue Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Product Sales | $150,285 | $76,133 |
| Professional Services | $3,400 | $8,627 |
| Total Appliance and Integration | $153,685 | $84,760 |
| SaaS | $14,182 | $12,540 |
| Support Services | $27,889 | $29,903 |
| Total SaaS and Services | $42,071 | $42,443 |
Cost Structure
The cost of revenue for Q3 2024 was $91.0 million, yielding a gross profit of $104.7 million and a gross margin of 53.5%, an improvement from 48.5% in Q3 2023. This margin expansion was attributed to increases in both segments, especially due to favorable product mix and cost reductions in manufacturing.
Operating Expenses
Harmonic's operating expenses for the quarter totaled $69.3 million, with significant line items including:
| Expense Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Research and Development | $30,073 | $30,316 |
| Selling, General and Administrative | $35,851 | $39,245 |
| Total Operating Expenses | $69,308 | $70,287 |
Net Income
For Q3 2024, Harmonic reported a net income of $21.7 million, translating to a net income per share of $0.19, compared to a net loss of $6.5 million in Q3 2023. The improvement in profitability was attributed to increased revenues and operational efficiencies.
Future Outlook
Harmonic's remaining performance obligations as of September 27, 2024, stood at $584.7 million, with 55% expected to be recognized as revenue in the next 12 months. The company plans to continue focusing on growth in its Broadband segment while seeking to stabilize its Video segment through restructuring and efficiency initiatives.
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Article updated on 8 Nov 2024
Resources:
- Harmonic Inc. (HLIT) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Harmonic Inc. (HLIT)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Harmonic Inc. (HLIT)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.