• Annual Revenue Growth: 13.5% increase in 2024, reaching $394.2 million.
• Q4 Revenue: $106.9 million, up 18.3% from Q4 2023.
• India Revenue: $55.6 million in Q4, an all-time record for Ceragon.
• North America Revenue: $13.4 million in Q4.
• Gross Profit (Q4): $36.7 million, a 15.5% increase from Q4 2023.
• Non-GAAP Gross Margin (Q4): 34.3%, compared to 35.1% in Q4 2023.
• Operating Income (Q4): $12.2 million, up from $7.8 million in Q4 2023.
• Net Income (Q4): $7.7 million, or $0.09 per diluted share, compared to $3.7 million or $0.04 per diluted share in Q4 2023.
• Cash Position (End of 2024): $35.3 million, up from $28.2 million at the end of 2023.
• Inventory (End of 2024): $59.7 million, down from $68.8 million at the end of 2023.
• Trade Receivables (End of 2024): $149.6 million, up from $104.3 million at the end of 2023.
• 2025 Revenue Outlook: Expected between $390 million to $430 million.
• 2025 Non-GAAP Operating Margin Outlook: At least 10%.

• Warning! GuruFocus has detected 5 Warning Sign with CRNT.

Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ceragon Networks Ltd (NASDAQ:CRNT) achieved record operating profit and the highest revenue levels since 2012.
• The company grew its annual revenue by more than 13% in 2024, outperforming the wireless transport market, which declined by over 10%.
• Ceragon Networks Ltd (NASDAQ:CRNT) increased its bookings from private networks by more than 50% and secured additional recurring revenue from managed services.
• The introduction of the IP-50 EX product has enabled significant new business and market share gains in India.
• The company has a strong cash position, with a net positive cash position of $10.1 million at the end of 2024, compared to a negative net cash position at the end of 2023.

Negative Points

• Ceragon Networks Ltd (NASDAQ:CRNT) faces low visibility for 2025, with potential impacts from the CSP market's softness.
• The company's gross margin decreased slightly to 34.3% in Q4 2024 from 35.1% in Q4 2023.
• There is a risk of project shifts in the private network market, impacting revenue visibility until a critical mass of projects is reached.
• The company is experiencing fluctuations in gross margins due to changes in regional revenue mix and volumes.
• Ceragon Networks Ltd (NASDAQ:CRNT) is not immune to global market trends, which could affect its performance despite recent successes.

Q & A Highlights

Q: Can you outline the role of the end-to-end acquisition in the energy industry and the types of customer relationships it brings to Ceragon? A: Doron Arazi, CEO: The end-to-end acquisition is a well-known system integrator in North America, primarily within the energy and utilities domain. They have a strong reputation and a robust portfolio of customers, including prominent industry players. Their relationships are strong, and they provide software that helps manage networks post-deployment. This acquisition enhances our understanding of private network needs and strengthens our position in the energy and utilities space.

Q: Are there any deal slips in the private network sector, and what types of customer opportunities are you seeing? A: Doron Arazi, CEO: Deal slippage is common in the private network sector, often due to the time it takes to close deals, especially with government institutions. We usually work directly or through system integrators, maintaining a strong relationship with end users to provide the best solutions. The slippage is driven by industry patterns and budget decisions.

Q: Can you provide more details on contract renewals or expansions in India? A: Doron Arazi, CEO: We are in a strong position in India, similar to when we launched the IP 20C. Our IP-50 EX product is gaining traction, especially with the demand for millimeter wave solutions. We have closed deals with two out of three major customers, and they are awaiting mass production of the IP-50 EX, expected to start in Q3.

Q: How should we think about gross margins with the introduction of new products? A: Doron Arazi, CEO: While new products may initially require more investment, we expect gross margins to improve in the second half of the year. This is also influenced by regional revenue mix and volumes.

Q: What are your long-term expectations for growth in private networks, and are you still pursuing M&A opportunities? A: Doron Arazi, CEO: We expect stronger growth in private networks in the second half of the year, particularly in North America. We continue to pursue M&A opportunities to strengthen our position. Our strategy is not limited to North America; we see opportunities globally, as demonstrated by our recent win in APAC.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.