IPG Photonics IPGP has reported earnings of 29 cents per share in the third quarter of 2024, beating the Zacks Consensus Estimate by 70.59%. The company had registered earnings of $1.16 in the year-ago quarter.

Revenues of $233.1 million declined 23% on a year-over-year basis but beat the consensus mark by 3.69%. Foreign exchange had no significant impact on revenues for the reported quarter.

The year-over-year decline in revenues primarily resulted from lower demand in the general industrial and e-mobility markets.

Emerging growth product revenues contributed 45% to the total revenues, which declined sequentially due to weakness in high-power pulsed lasers and medical products.

IPG Photonics Corporation Price, Consensus and EPS Surprise

IPG Photonics Corporation price-consensus-eps-surprise-chart | IPG Photonics Corporation Quote

The stock has declined 22.4% year to date against the Zacks Computer & Technology sector’s growth of 27.1%.

IPGP's Quarterly Details

Materials processing (89% of the total revenues) fell 22% year over year. The downside was mainly led by lower sales in cutting applications.

Revenues from other applications decreased 28% year over year due to lower revenues in medical and advanced applications.

Sales dropped 20% in North America, 27% in China and 8% in Japan on a year-over-year basis. Sales decreased 29% year over year in Europe.

IPG Photonics has reported a gross margin of 23.2%, down significantly on a year-over-year basis. The downside was led by higher inventory provisions and under-absorption of manufacturing costs, partially offset by lower import duties and shipping costs.

Balance Sheet

As of Sept. 30, 2024, IPG Photonics had $1.02 billion in cash and cash equivalents compared with $1.06 billion as of June 30, 2024.

The third-quarter 2024 cash flow from operations amounted to $66 million compared with the previous quarter’s $53 million.

In the third quarter, IPG generated $66 million in cash from operations compared with the previous quarter’s $53 million. The company spent $23 million in capital expenditure and allocated $74 million for share repurchases.

Guidance

For fourth-quarter 2024, IPG Photonics anticipates sales of $210-$240 million. Earnings are projected between 5 cents and 30 cents per share.

Zacks Rank & Stocks to Consider

IPG Photonics currently has a Zacks Rank #4 (Sell).

Yelp YELP, AudioEye AEYE, and Radware RDWR are some better-ranked stocks in the broader sector.

Yelp has a Zacks Rank #1 (Strong Buy) at present, and AudioEye and Radware carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

YELP shares have declined 27.6% year to date. Yelp is set to report third-quarter 2024 results on Nov. 7.

AEYE shares have surged 316.4% year to date. AudioEye is set to post third-quarter 2024 results on Nov. 7.

RDWR shares have gained 35.6% year to date. Radware is set to report third-quarter 2024 results on Oct. 31.

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