The share price of AudioCodes Ltd. (Nasdaq: AUDC; TASE: AUDC) (NASDAQ: AUDC) is up by nearly 10% on the Tel Aviv Stock Exchange this morning, at NIS 88.65, following the release of the company's first quarter results, which beat market estimates.
AudioCodes, which provides voice networking and media processing solutions for the digital workplace, had revenue totaling $52 million for the first quarter of 2020, which compares with $46.6 million for the first quarter of 2019, and with an analysts' consensus estimate of $50.9 million. Non-GAAP earnings per share were $0.25, $0.02 ahead of the consensus estimate. AudioCodes is considered to be one of the companies that will actually benefit from the trends emerging from the coronavirus crisis, because it provides technological solutions facilitating remote working, among other things through its collaboration with Microsoft.
In comparison with the corresponding quarter of 2019, AudioCodes' revenue from products grew 5.8%, to $34.3 million, and revenue from services, which are more profitable, grew 25.2%, to $17 million.
On a GAAP basis, net profit was $5.3 million, or $0.17 per diluted share, for the first quarter of 2020, which compares with $3.0 million, or $0.10 per diluted share, for the first quarter of 2019.
On a Non-GAAP basis, net profit was $7.8 million for the first quarter of 2020, which compares with $5.5 million for the first quarter of 2019, representing a rise of 41%.
Net cash provided by operating activities was $6.8 million for the first quarter of 2020. Cash and cash equivalents and long- and short-term bank deposits were $74.2 million at the end of the quarter, up from $71.9 million at the end of 2019. The company distributed a $3.9 million dividend in March this year.
"We are pleased to report strong financial results for the first quarter of 2020," said AudioCodes president and CEO Shabtai Adlersberg. "We continued to enjoy good business momentum in the quarter in both the enterprise and the service providers' space.
"Turning to the impact of the COVID-19 pandemic," Adlersberg continued, "around the middle of the first quarter we experienced difficulties in the manufacturing of our hardware products in China. We were able to quickly recover from the associated delay and were able to ship all of our products as planned during the quarter. In compliance with the Israeli regulations meant to cope with the COVID-19 crisis, we have moved the majority of HQ employees to a work-from-home basis, a transition that went smoothly. Based on business activity during the 1Q20 and past few weeks, we believe that we should be able to meet our original targeted performance plan for the full year and the second quarter.
"On a positive note," he added, "we have seen increased market activity and demand in two of our leading business activities: the Microsoft Teams application for UCaaS and the rapidly growing trend of work-from-home.
"While the full impact of COVID-19 is still uncertain and remains a global challenge, thus far any immediate business setbacks we have encountered have been balanced by new business opportunities presented to us. We plan to continue our investment in future offerings, and focus on the return on investment to our shareholders."
Published by Globes, Israel business news - en.globes.co.il - on April 27, 2020
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