First Quarter Highlights:
- Quarterly revenues increased 7.5% year-over-year to $37.4 million;
- Quarterly service revenues increased 11.2% year-over-year to $11.4 million;
- Revenues related to UC-SIP business increased more than 18% compared to the first quarter of 2016;
- Quarterly GAAP gross margin was a record 62.4%, Quarterly Non-GAAP gross margin was a record 62.9%;
- Quarterly GAAP operating margin was 5.3%, Quarterly Non-GAAP operating margin was 7.3%;
- Quarterly cash flow from operating activities was $854,000;
- Quarterly GAAP net income was $1.3 million, or $0.04 per diluted share, compared to a GAAP net loss of $222,000, or $(0.01) per diluted share, in the prior year period;
- Quarterly Non-GAAP net income was $2.5 million, or $0.07 per diluted share, compared to $1.6 million, or $0.04 per diluted share, in the prior year period;
- AudioCodes repurchased 1.1 million shares of its ordinary shares during the first quarter at an aggregate cost of $7.3 million.
AudioCodes (Nasdaq: AUDC), a leading provider of converged voice solutions that enable enterprises and service providers to transition to all-IP voice networks, today announced financial results for the first quarter ended March 31, 2017.
Revenues for the first quarter of 2017 were $37.4 million, compared to $37.8 million for the fourth quarter of 2016 and $34.8 million for the first quarter of 2016.
Net income was $1.3 million, or $0.04 per diluted share, for the first quarter of 2017, compared to a net loss of $222,000, or ($0.01) per diluted share, for the first quarter of 2016.
On a Non-GAAP basis, quarterly net income was $2.5 million, or $0.07 per diluted share, compared to $1.6 million, or $0.04 per diluted share, in the first quarter last year.
Non-GAAP net income excludes: (i) stock-based compensation expenses; (ii) amortization expenses related to intangible assets; (iii) expenses related to deferred payments in connection with the acquisition of Active Communications Europe and (iv) non-cash deferred tax benefit or expenses. A reconciliation of net income (loss) on a GAAP basis to a non-GAAP basis is provided in the tables that accompany the condensed consolidated financial statements contained in this press release.
Net cash provided by operating activities for the first quarter of 2017 totaled $854,000. Cash and cash equivalents, bank deposits and marketable securities were $62.8 million as of March 31, 2017 compared to $69.5 million as of December 31, 2016. The decrease in cash and cash equivalents, long and short-term bank deposits and long and short-term marketable securities was the result of the use of cash for the continued repurchasing of the Company’s ordinary shares pursuant to its share repurchase programs.
“We are pleased to report solid financial results for the first quarter of 2017,” said Shabtai Adlersberg, President and Chief Executive Officer of AudioCodes. “Our financial performance was in line with our guidance for the full year, and with our strategic plan to grow the UC-SIP business at an annual rate of 15% to 20%.”
Mr. Adlersberg continued “The global trend of migrating voice services to all-IP, and the continued growth in the unified communications, UCaaS, SIP trunking and contact centers markets have all contributed to our strong business performance. Underlining the strength in our voice networking business, the first quarter of 2017 was the third quarter in a row in which gateway revenues grew, reversing the declining trend of gateway revenues that was experienced in 2015 and the first half of 2016.”
“We remain focused on strengthening our strategic partnerships with the market leaders in the Microsoft Skype for business and the UCaaS markets as we continue to win customer opportunities and projects. We also continued to buy back shares in the first quarter to return value to shareholders, as we are confident in the continued strength of our future business opportunities,” concluded Mr. Adlersberg.
Share Buy Back Program
During the quarter ended March 31, 2017, AudioCodes acquired 1,105,608 of its ordinary shares under its share repurchase program for a total consideration of approximately $7.3 million. As of March 31, 2017, AudioCodes had acquired an aggregate of 13.1 million of its ordinary shares since August 2014 for an aggregate consideration of approximately $61.5 million.
On March 20, 2017, our Board of Directors approved filing a new application with the court in Israel requesting approval for an additional repurchase program for $15 million of Ordinary Shares. We filed a new application and we are expecting a decision in the coming weeks.
Conference Call & Web Cast Information
AudioCodes will conduct a conference call at 8:00 A.M., Eastern Time today to discuss the Company’s first quarter operating performance, financial results and outlook. Interested parties may participate in the conference call by dialing one the following numbers:
- United States Participants: +1 877-407-0778
- International Participants: +1 201-689-8565
The conference call will also be simultaneously webcast. Investors are invited to listen to the call live via webcast at the AudioCodes investor website at http://www.audiocodes.com/investors-lobby.