CommScope (COMM) sinks 20% after warning

CommScope (NASDAQ: COMM) shares fell 20% after the company reported preliminary third-quarter results.

COMM reported preliminary adjusted earnings per share of 13 cents, while the consensus was 33 cents. The preliminary adjusted EBITDA was approximately $249 million, below the estimate of $283.8 million.

Moreover, CommScope's preliminary net sales for the third quarter were $1.60 billion, way below the consensus of $2 billion.

For the full year, CommScope expects Core Adjusted EBITDA to be in the range of $1.00 billion to $1.05 billion.

“The weaker macroeconomic backdrop and customer inventory digestion continues to negatively impact revenues, resulting in the Company lowering our prior adjusted EBITDA guideposts,” said Chuck Treadway, President and CEO of CommScope.

“As we moved through the quarter, in addition to already discussed challenges in CCS and OWN, we also saw demand weaken in our ANS business where customers are managing higher than required inventory levels and experiencing project delays in some of their upgrade plans. We believe this softer demand environment will continue as we move into the first half of 2024, impacting both revenue and profitability."

By Senad Karaahmetovic

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