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Airspan Networks Holdings Inc. (MIMO)·Q3 2023 Earnings Summary

Executive Summary

  • Revenue fell sharply to $14.3M, down 56% QoQ from $32.1M and 65% YoY from $41.1M, while gross margin improved to 36.7% from 21.0% in Q2 (39.8% in Q3’22) .
  • Reported net income of $9.9M was driven by a $28.6M gain on the sale of the Mimosa subsidiary; underlying operations remained loss-making with Adjusted EBITDA of -$7.9M (vs -$15.2M in Q2, -$10.0M in Q3’22) .
  • Operating expenses were reduced meaningfully to $16.1M (from $27.5M in Q2 and $33.1M in Q3’22), reflecting restructuring actions and cost control; prior quarter included $3.0M restructuring charges .
  • The Mimosa sale delivered ~$10.5M of cash and reduced indebtedness by ~$40M, easing liquidity constraints after covenant challenges earlier in 2023 .

What Went Well and What Went Wrong

  • What Went Well

    • Completed Mimosa divestiture, generating a $28.6M gain, ~$10.5M in cash proceeds, and ~$40M debt reduction .
    • Sequential Adjusted EBITDA improved to -$7.9M from -$15.2M in Q2 as opex dropped and prior quarter’s inventory impairment did not recur .
    • Gross margin rebounded to 36.7% vs 21.0% in Q2 (adjusted GM 43.4% excluding Q2’s $7.2M inventory provision), supported by mix and cost actions .

  • What Went Wrong

    • Revenue contracted steeply to $14.3M (from $32.1M QoQ and $41.1M YoY), indicating demand and execution headwinds across products/services .
    • Underlying operations remained negative: loss from operations was $(10.9)M and Adjusted EBITDA was $(7.9)M despite divestiture gains .
    • Prior quarters highlighted liquidity/covenant pressures and restructuring, with Q2 including a $7.2M inventory impairment and $3.0M restructuring charges .

Financial Results

MetricQ3 2022Q1 2023Q2 2023Q3 2023
Revenue ($M)$41.1 $24.8 $32.1 $14.3
Gross Margin %39.8% —21.0% 36.7%
Operating Expenses ($M)$33.1 $28.0 $27.5 $16.1
Operating Income ($M)$(16.8) $(17.6) $(20.8) $(10.9)
Net Income ($M)$(23.3) $(20.9) $(33.6) $9.9
Diluted EPS ($)$(0.60) $(0.28) $(0.45) $0.12
Adjusted EBITDA ($M)$(10.0) $(13.8) $(15.2) $(7.9)

Segment/Revenue Category Breakdown

Revenue Category ($M)Q3 2022Q1 2023Q2 2023Q3 2023
Products & Software Licenses$36.5 $21.2 $28.9 $11.3
Maintenance, Warranty & Services$4.6 $3.6 $3.3 $2.9
Total Revenue$41.1 $24.8 $32.1 $14.3

Selected KPIs and Balance Sheet Items

KPIQ3 2022Q1 2023Q2 2023Q3 2023
DSO (days)—90 94 —
Cash & Equivalents ($M)—$3.28 $10.10 $8.17
Senior Term Loan (Current) ($M)—$41.0 $4.18 current; $59.0 LT $41.5 current
Convertible Debt (Current) ($M)—$45.5 $47.7 $31.7 current
Subordinated Debt (Current) ($M)—$11.3 $11.4 $11.5 current

Note: Gross margin % not shown for Q1 due to disclosure format; DSO not disclosed for Q3.

Guidance Changes

No formal quantitative guidance was provided in the Q3 2023 earnings materials.

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY/Quarter———
Gross/Operating MarginFY/Quarter———
OpExFY/Quarter———
EPSFY/Quarter———

(Company did not issue explicit guidance in the Q3 2023 press release/8-K) .

Earnings Call Themes & Trends

Q3 2023 earnings call transcript was not available in the document set. Themes below reflect press release and recent filings.

TopicPrevious Mentions (Q1 2023, Q2 2023)Current Period (Q3 2023)Trend
Liquidity & CovenantsQ1: Covenant breaches and payment defaults; pursuing waivers/financing . Q2: Amendments reduced liquidity minimums; in compliance at quarter end .Mimosa sale used to repay ~$45M obligations; debt reduced and cash added .Improving but still leveraged
Restructuring & Cost ActionsQ1: Initial restructuring costs ($0.3M) . Q2: $3.0M restructuring, $7.2M inventory impairment .Opex cut to $16.1M; no new impairment in Q3 .Positive opex trajectory
Product/Revenue Mix & DemandQ1/Q2: Demand variability, supply chain cost pressures .Revenue decline across Products/Services (Q3: $11.3M/$2.9M) .Weak demand/execution
Strategic Portfolio (Mimosa)Q1/Q2: Negotiated sale; approvals obtained .Sale closed; reseller/transition/licensing agreements in place .Portfolio focus sharpened
Gross Margin DynamicsQ2: 21.0% GM; adjusted 43.4% excl. inventory provision .GM rebounded to 36.7% .Sequential improvement

Management Commentary

  • “Adjusted EBITDA (non-GAAP) was a loss of $7.9M compared to a loss of $15.2M in Q2 2023 and a loss of $10.0M in Q3 2022” .
  • “Total operating expenses of $16.1M compared to $27.5M in Q2 2023, and $33.1M for Q3 2022” .
  • “On August 11, 2023…the sale of Mimosa to Radisys…provided approximately $10.5M of cash… and reduced the Company’s indebtedness by approximately $40.0M” .

Q&A Highlights

The Q3 2023 earnings call transcript was not available; no Q&A highlights could be extracted.

Estimates Context

Consensus estimates from S&P Global were unavailable for MIMO due to missing mapping in the SPGI CIQ database, so we cannot assess beat/miss vs Wall Street consensus for Q3 2023 at this time. Future comparison will be added once SPGI mapping is available.

Key Takeaways for Investors

  • One-time transaction gain masks weak underlying operations; focus on Adjusted EBITDA (-$7.9M) and operating loss ($(10.9)M) rather than reported net income .
  • Revenue contraction and product/service declines warrant close monitoring of demand recovery and sales execution (Products $11.3M; Services $2.9M) .
  • Margin trajectory is improving (GM 36.7% vs 21.0% in Q2) as restructuring costs and inventory charges abate; sustainability depends on mix and cost discipline .
  • Balance sheet relief from Mimosa sale (cash proceeds; debt reduction) is positive against prior covenant pressures, but leverage and liquidity remain key risks .
  • Opex discipline (Q3 opex $16.1M) supports path to lower cash burn; watch for continued restructuring benefits without harming R&D/product momentum .
  • Absence of guidance and unavailable consensus estimates increases reliance on sequential trend analysis and upcoming filings to gauge trajectory .
  • Near-term trading: stock likely sensitive to updates on pipeline conversion, margin retention, and any further balance sheet actions; medium-term thesis hinges on Open RAN/private 5G execution and cost structure normalization .