Ceragon Networks Ltd. (NASDAQ:CRNT) Q3 2018 Earnings Conference Call Transcript
Nov 05, 2018 • 09:00 am ET
Good day, everyone. Welcome to the Ceragon Networks Limited Third Quarter Results Conference Call. Today's call is being recorded and will be hosted by Mr. Ira Palti, President and CEO of Ceragon Networks.
(Forward-Looking Cautionary Statements) Also today's call will include certain non-GAAP numbers. For a reconciliation between GAAP and non-GAAP results, please see the table attached to the press release that was issued earlier today.
I will now turn the call over to Mr. Ira Palti, President and CEO of Ceragon. Please go ahead, sir.
Thank you for joining us today. With me on the call is Doron Arazi, our CFO. We are very pleased to report an excellent third quarter, which was above the top end of our quarterly revenue run rate, with net income growing both sequentially and year-over-year. We also generated very strong cash flow during the quarter. In addition, we are on track to meet our goal of attaining an increase in non-GAAP net income in 2018 compared to 2017.
Based on the current outlook, we believe we are able to extend our goal of net income growth to 2019 as well. We are benefiting from the early stages of the migration of network from 4G to 5G technology. And as noted on past calls, this is a long multiyear global process, not an event that happens everywhere at once. Operators around the world are planning the path to 5G, but they are at different stages as a starting point. Some are still building out 4G to bridge the digital divide and bring broadband access to more of their population, while others are expanding capacity and densifying 4G networks in preparation to launch 5G.
The common denominator for all of them is that they are looking for wireless backhaul solutions that combine the benefit of flexibility, enabling rapid site acquisition, quick rollout and conserving resources, such as spectrum and power. As a result of offering a full set of solutions and the trends from 4G to 5G, we are seeing many positive developments worldwide, and our book-to-bill in Q3 was above 1, excluding India, which tends to be lumpy. Furthermore, we saw an increase in booking during Q3 in most regions around the world.
To discuss some details of the current situation, the outlook in each region, we will begin with India. In this hyper competitive market, our IP-20 all-outdoor solution enables very rapid network rollout with the most efficient use of resources and maximum future flexibility. These characteristics have enabled us to achieve a very strong market share in India already. We expect operators in the region to continue to spend on significant expansion and densification of the networks as the Indian broadband data boom continues.
For example, Vodafone India plans to make vendor selection soon, and we are working hard to get our share of that business. Therefore, we expect continued spending on wireless backhaul capacity in India for the next couple of years. We know from past experience that spending decisions tend to