Harmonic Inc. · NASDAQ:HLIT
Harmonic — Q4 2020 Earnings Presentation
25 slides from Harmonic's earnings presentation, Feb 1, 2021
Slide 1: Fourth Quarter 2020 Earnings Conference Call
FOURTH QUARTER 2020 EARNINGS CONFERENCE CALL Patrick Harshman, President & CEO Sanjay Kalra, CFO February 1, 2021 ©2021 Harmonic Inc. All rights reserved worldwide. 1
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS During the course of this presentation, we will provide projections and other forward-looking statements regarding future events or the future financial performance of Harmonic, including expectations concerning our business strategy for 2021 and beyond, and our Q1 and ful
Slide 3: Q4 2020 Highlights
Q4 2020 HIGHLIGHTS Corporate Cable Access Video Record bookings; Highest revenue Growing deployments solid revenue, earnings and cash and customer wins in two years Strong Execution and Market Momentum ©2021 Harmonic Inc. All rights reserved worldwide. 3
Slide 4: Cable Access Segment Update
CABLE ACCESS SEGMENT UPDATE STRONG Q4 EXECUTION • Commercially deployed with 44 operators, up 91% year over year • 2.6 million cable modems served, up 149% year over year • Revenue $45.5 million, operating margin 21.8%* POSITIONED FOR CONTINUED GROWTH • New Tier 1 North America customer win • Existi
Slide 5: Video Segment Update
VIDEO SEGMENT UPDATE STRONG Q4 EXECUTION • Solid demand for both Broadcast and Streaming solutions • Revenue $86.0 million, operating margin 15.7%* • Full year operating profit POSITIVE MEDIA INVESTMENT TRENDS • Streaming investments steadily growing • 5G bandwidth reclamation solution gaining broad
Slide 6: Financial Results and Outlook
FINANCIAL RESULTS AND OUTLOOK Sanjay Kalra, CFO ©2021 Harmonic Inc. All rights reserved worldwide. 6
Slide 7: Q4 2020 Revenue & Gross Margin Highlights
Q4 2020 REVENUE & GROSS MARGIN HIGHLIGHTS* Financial Metric Q4 Q3 Q4 Q4/Q3 Q4 Y/Y ($ Millions) 2020 2020 2019 Change Change Total Net Revenue $131.5 $94.9 $122.2 38.6% 7.7% Cable Access Revenue $45.5 $40.3 $43.0 13.0% 5.8% Video Revenue $86.0 $54.6 $79.2 57.5% 8.7% Gross Margin % 55.3% 52.2% 52.3% 3
Slide 8: Q4 2020 Financial Highlights
Q4 2020 FINANCIAL HIGHLIGHTS* Financial Metric Q4 Q3 Q4 Q4/Q3 Q4 Y/Y $ Millions (except EPS) 2020 2020 2019 Change Change Operating Expenses $49.3 $45.3 $49.2 8.8% 0.3% Operating Income $23.4 $4.2 $14.8 $19.2 $8.6 Cable Access Operating Income $9.9 $5.9 $3.7 $4.0 $6.2 Video Operating Income (Loss) $
Slide 9: Q4 2020 Balance Sheet & Cash Flow Highlights
Q4 2020 BALANCE SHEET & CASH FLOW HIGHLIGHTS Financial Metric Q4 Q3 Q4 ($ Millions) 2020 2020 2019 Cash $98.6 $70.8 $93.1 Cash Provided by (Used in) Operations $41.6 $(3.3) $30.2 Accounts Receivable $66.2 $81.4 $88.5 DSO 45 77 65 Inventories $35.0 $36.8 $29.0 Inventory Days 54 73 45 Backlog and Defe
Slide 10: Full Year 2021 Financial Guidance
FULL YEAR 2021 FINANCIAL GUIDANCE* Midpoint Financial Metric Guidance FY2020 Actual Difference Total Revenue ($M) $430.0 - $465.0 $378.8 18% Video Segment ($M) $260.0 - $275.0 $242.5 10% Cable Access Segment ($M) $170.0 - $190.0 $136.3 32% Gross Margin 51.5% - 54.5% 52.5% 50bp Operating Expenses ($M
Slide 11: Q1 2021 Financial Guidance
Q1 2021 FINANCIAL GUIDANCE* Midpoint Financial Metric Guidance Q1 2020 Actual Difference Total Revenue ($M) $97.0 - $107.0 $78.4 30% Video Segment ($M) $61.0 - $66.0 $54.4 17% Cable Access Segment ($M) $36.0 - $41.0 $24.0 60% Gross Margin 51.5% - 53.5% 48.9% 360bp Operating Expenses ($M) $49.0 - $51
Slide 12: 2021 Strategic Priorities
2021 STRATEGIC PRIORITIES Cable Access Video Grow Tier 1 CableOS deployments Build Streaming and SaaS customer base Add new CableOS design wins Capitalize on broadcast transformations Expand addressed market through FTTH Grow revenue and operating profit Create value. Deliver industry-leading soluti
Slide 13: Q&A
Q&A ©2021 Harmonic Inc. All rights reserved worldwide. 13
Slide 14: Use of Non-GAAP Financial Measures
USE OF NON-GAAP FINANCIAL MEASURES In establishing operating budgets, managing its business performance, and setting internal measurement targets, the Company excludes a number of items required by GAAP. Management believes that these accounting charges and credits, most of which are non-cash or non
Slide 15: Q4 2020 GAAP to Non-GAAP Reconciliations
Q4 2020 GAAP TO NON-GAAP RECONCILIATIONS (IN THOUSANDS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 15
Slide 16: Q3 2020 GAAP to Non-GAAP Reconciliations
Q3 2020 GAAP TO NON-GAAP RECONCILIATIONS (IN THOUSANDS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 16
Slide 17: Q4 2019 GAAP to Non-GAAP Reconciliations
Q4 2019 GAAP TO NON-GAAP RECONCILIATIONS (IN THOUSANDS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 17
Slide 18: 2020 GAAP to Non-GAAP Reconciliations
2020 GAAP TO NON-GAAP RECONCILIATIONS (IN THOUSANDS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 18
Slide 19: 2019 GAAP to Non-GAAP Reconciliations
2019 GAAP TO NON-GAAP RECONCILIATIONS (IN THOUSANDS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 19
Slide 20: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION (IN THOUSANDS) ©2021 Harmonic Inc. All rights reserved worldwide. 20
Slide 21: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION (IN THOUSANDS) ©2021 Harmonic Inc. All rights reserved worldwide. 21
Slide 22: Q1 2021 Guidance GAAP to Non-GAAP Reconciliations
Q1 2021 GUIDANCE GAAP TO NON-GAAP RECONCILIATIONS (IN MILLIONS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 22
Slide 23: 2021 Guidance GAAP to Non-GAAP Reconciliations
2021 GUIDANCE GAAP TO NON-GAAP RECONCILIATIONS (IN MILLIONS, EXCEPT EPS AND PERCENTAGES) ©2021 Harmonic Inc. All rights reserved worldwide. 23
Slide 24: Adjusted EBITDA Reconciliation on Financial Guidance
ADJUSTED EBITDA RECONCILIATION ON FINANCIAL GUIDANCE (IN MILLIONS) ©2021 Harmonic Inc. All rights reserved worldwide. 24
Slide 25: Thank You
THANK YOU. ©2021 Harmonic Inc. All rights reserved worldwide. 25