iRobot Corporation (NASDAQ:IRBT) Q4 2018 Earnings Conference Call Transcript

Feb 07, 2019 • 08:30 am ET


iRobot Corporation (NASDAQ:IRBT) Q4 2018 Earnings Conference Call Transcript


Loading Event

Loading Transcript


Good day, ladies and gentlemen, and welcome to the Fourth Quarter and Full-Year 2018 IRobot Corp Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer and instructions will follow at that time. (Operator Instructions) As a reminder, this is call is being recorded.

I would now like to introduce your host for today's conference, Elise Caffrey, iRobot Investor Relations. Ma'am, you may begin.

Elise Caffrey

Thank you and good morning. Before I introduce the iRobot management team, I would like to note that statements made on today's call that are not based on historical information are forward-looking statements made pursuant to Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties and involve many factors that could cause actual results to differ materially from those expressed or implied by such statements. Additional information on these risks and uncertainties can be found in our public filings with the Securities and Exchange Commission.

iRobot undertakes no obligation to update or revise these forward-looking statements whether as a result of new information or circumstances. During this conference call, we may also disclose non-GAAP financial measures as defined by SEC Regulation G, including adjusted EBITDA, non-GAAP gross profit, non-GAAP income before income taxes, non-GAAP income tax expense, non-GAAP net income, and non-GAAP net income per share. Our definitions of these non-GAAP financial measures and reconciliations of the each of these non-GAAP financial measures to the most directly comparable GAAP measure are provided in the financial tables at the end of the fourth quarter and full-year 2018 earnings press release issued last evening, which is available on our website.

On today's call, iRobot Chairman and CEO, Colin Angle, will provide a review of the Company's operations and achievements for the fourth quarter and full-year 2018 and Alison Dean, Chief Financial Officer, will review our financial results for the fourth quarter and full-year 2018.

Colin and Alison will also provide our business and financial expectations for fiscal 2019 as well as updated financial targets through 2020. Then we'll open the call for questions. At this point, I'll turn the call over to Colin Angle.

Colin Angle

Good morning, and thank you for joining us. We had a phenomenal finish to 2018, exceeding both our fourth quarter and full year expectations for revenue growth and profitability after raising our expectations twice during the year. Revenue grew 24% crossing the $1 billion revenue threshold in an increasingly competitive market and we delivered an operating margin of nearly 10% after absorbing the impact of tariffs in Q4. Substantial demand for our game changing Roomba i7 and i7+ robots grew strong holiday performance domestically. Overseas, overperformance in Japan was driven by robust Q4 demand supported by our sales and marketing programs in that region.

In 2019, we will continue on a growth diversification journey, focusing on driving growth of non-Roomba products as well as supply chain and manufacturing diversification for longer-term production stability. Our