Ubiquiti (UI) Up 1.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Ubiquiti Inc. (UI). Shares have added about 1.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Ubiquiti due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Ubiquiti’s Q2 Earnings Rise Y/Y, Revenues Top Estimates
Ubiquiti reported solid second-quarter fiscal 2021 results, wherein the top line beat the Zacks Consensus Estimate.
Net Income
On a GAAP basis, net income in the December quarter was $159.7 million or a record $2.54 per share compared with $85.8 million or $1.32 per share in the prior-year quarter. The improvement primarily resulted from higher operating income.
Non-GAAP net income came in at $159 million or $2.53 per share compared with $91.4 million or $1.40 per share in the year-ago quarter.
Revenues
Quarterly revenues increased 55.5% year over year to a record $479.4 million, primarily driven by an increase in direct sales through the company’s webstores.
Revenues from Service Provider Technology were $149.9 million compared with $97.7 million in the year-ago quarter. Enterprise Technology revenues were $329.6 million, up from $210.6 million. The top line surpassed the consensus estimate of $414 million.
Region wise, revenues from North America were $193.4 million compared with $130 million in the year-ago quarter. Revenues from Europe, Middle East and Africa were $218.7 million, up from $120.6 million. Revenues from Asia Pacific were $37.4 million compared with $32.8 million a year ago, and the same from South America totaled $29.9 million, up from $24.9 million.
Other Details
Gross profit increased to $230.7 million from $145.1 million in the year-ago quarter, led by higher revenues. Gross margin improved to 48.1% from 47.1%, driven by favorable changes in product mix. This was, however, partly offset by higher shipping costs.
Total operating expenses increased to $39.9 million from $33 million in the prior-year quarter. This was due to higher research and development as well as sales, general and administrative expenses. Operating income came in at $190.8 million compared with $112 million a year ago.
During the quarter, Ubiquiti repurchased 309,133 shares at an average price of $178.11 per share. The board approved a cash dividend of 40 cents per share. The amount is payable on Feb 22 to shareholders on record as of Feb 16.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
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