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Jul 23, 2023

Cambium Networks Shares Drop 29% on 2Q Results, CEO Switch

By Will Feuer Shares of Cambium Networks lost more than a quarter of their value after the maker of broadband network infrastructure reported a drop in second-quarter sales, cut its full-year outlook

By Will Feuer

Shares of Cambium Networks lost more than a quarter of their value after the maker of broadband network infrastructure reported a drop in second-quarter sales, cut its full-year outlook and appointed a new chief executive officer.

The stock tumbled to $11.53 a share in afternoon trading on Wednesday, returning to its lowest level since 2020. So far this year, the stock is down about 47%.

The Rolling Meadows, Ill.-based company on Tuesday evening said it has launched a cost-cutting program with the goal of lowering expenses by $14 million a year.

Cambium also said Chief Executive Atul Bhatnagar was stepping down immediately and would be succeeded by Morgan Kurk, a former Honeywell executive. Bhatnagar will remain a board member.

For the second quarter, Cambium said mounting inventories and economic slowdowns in various pockets of the world weighed on sales, which fell 14% from a year earlier to $59.5 million, below the $76.6 million analysts surveyed by FactSet expected.

The company also swung to a quarterly loss of $2.64 million, or 10 cents a share, compared with earnings of $2.32 million, or 8 cents a share, in the same period a year earlier.

Adjusted earnings of 3 cents a share fell below the 21 cents a share that analysts were expecting, according to FactSet.

Cambium also gave its full-year sales and earnings outlook a steep cut. The company is now targeting annual sales of $265 million to $275 million, reflecting a year-over-year drop of 7% to 11%. In May, the company guided for sales of $327 million to $337 million.

The company is targeting full-year adjusted earnings of 59 cents a share to 78 cents a share, down from previous guidance for adjusted earnings of $1.18 a share to $1.26 a share.

Write to Will Feuer at [email protected]

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