AudioCodes Ltd. (NASDAQ:AUDC) Q2 2020 Earnings Conference Call - Final Transcript

Jul 28, 2020 • 08:30 am ET

Previous

AudioCodes Ltd. (NASDAQ:AUDC) Q2 2020 Earnings Conference Call - Final Transcript

Share
Close

Loading Event

Loading Transcript

Presentation
Executive
Niran Baruch

we will be referring to both GAAP and non-GAAP financial results. The earnings press release that we issued earlier this morning contains a reconciliation of the supplemental non-GAAP financial information that I will be discussing on this call. Revenues for the second quarter were $53.5 million, an increase of 8.1% compared to the second quarter last year. Services revenues for the second quarter were $17.1 million, accounting for 32.1% of total revenues. The amount of deferred revenues as of June 30, 2020 was $65.1 million compared to $55.8 million as of June 30, 2019. Revenues by geographical region for the quarter were split as follows: North America, 41%; Central and Latin America, 7%; EMEA, 40%; and Asia-Pacific, 12%. Our top 15 customers in aggregate represented 60% of revenues in the second quarter; of which, 42% are attributed to our nine largest distributors.

Gross margin for the quarter was 66.7% compared to 63.3% in Q2 2019. Non-GAAP gross margin for the quarter was 66.9% compared to 63.5% in Q2 2019. Operating income for the quarter was $8.8 million, compared to an operating income of $5.9 million in Q2 2019. On a non-GAAP basis, quarterly operating income was $10.7 million or 20.1% of revenues, compared to an operating income of $7 million in Q2 2019. Net income for the quarter was $6.6 million or $0.21 per share, compared to net income of $4.8 million or $0.16 per share in Q2 2019. On a non-GAAP basis, quarterly net income was $10.5 million or $0.32 per share, compared to net income of $6.8 million or $0.22 per share in Q2 2019.

During the quarter, the company raised $85.4 million in net proceeds from the public offering of 2.6 million ordinary shares at a purchase price of $35 per share. At the end of June 2020, cash, cash equivalents and bank deposits totaled $170.4 million. Days sales outstanding as of June 30, 2020 were 51 days. Operating cash flow generated during the quarter was $10.7 million.

Now, to providing an update on our guidance, we reiterate our guidance for revenues for 2020 to be in the range of $214 million to $222 million. We're now raising our guidance for non-GAAP diluted earnings per share to be in the range of $1.18 to $1.24, compared to the previous range of $1.09 to $1.13 that we updated following the close of the first quarter 2020.

I will now turn the call back over to Shabtai.

Executive
Shabtai Adlersberg

Thank you, Niran. We're very pleased to report strong financial results for the second quarter 2020. As stated earlier in our financial release, we enjoyed good business momentum in the quarter, both in the enterprise space and the service provider space. There is no question in our markets these days, the team collaboration is where the action is when it comes to enterprise communication platforms, primarily because of the fact that the pandemic forced enterprises to move employees to work from home and roll out collaboration systems like Microsoft Teams, which end