Napatech: Weak Q2, but new design win - ABG

Q2 revenue 29% below, won't meet '24 guidance
Design win with SigmaX.AI, could be up to 5-10k units
Cons to cut '24 revenue by 18-25%, but '26e up due to new design win


Q2 revenue 29% below and 14m EBITDAC miss

Napatech delivered sales of DKK 23.2m, down 39% y-o-y and 29% below ABGSCe at DKK 32.6m. The gross margin, was 65%, vs. ABGSCe at 70%. Total opex incl. capitalised dev costs were DKK -43.3, above our estimate of DKK -37.4m. As a result, EBITDAC was DKK -28.2m, DKK 14m below ABGSCe at DKK -14.6m. We think the weakness in the legacy business to a large degree is driven by one large customer, NetScout. NetScout is the company's largest customer and could account for up to 50% of revenues in certain quarters. NetScout is now basically ordering zero products due to a weak market and because it sits on significant inventory.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/Napatech/Equity-research/2024/8/napatech---weak-q2-but-new-design-win-/