Infinera Corporation (INFN) swung to a net loss for the quarter ended Sep. 24, 2016. The company has made a net loss of $11.17 million, or $ 0.08 a share in the quarter, against a net profit of $8.51 million, or $0.06 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $7.42 million, or $0.05 a share compared with $33.22 million or $0.22 a share, a year ago.
Revenue during the quarter dropped 20.23 percent to $185.45 million from $232.47 million in the previous year period. Gross margin for the quarter expanded 140 basis points over the previous year period to 45.62 percent. Operating margin for the quarter stood at negative 5.86 percent as compared to a positive 6.13 percent for the previous year period.
Operating loss for the quarter was $10.86 million, compared with an operating income of $14.26 million in the previous year period.
However, the adjusted operating income for the quarter stood at $6.59 million compared to $33.61 million in the prior year period. At the same time, adjusted operating margin contracted 1090 basis points in the quarter to 3.55 percent from 14.46 percent in the last year period.
"As expected, weak demand across much of our business in the third quarter led to financial results that were below our standards,” said Tom Fallon, Infinera's chief executive officer. “While the revenue environment is likely to remain challenging in the near term, we are making continued progress towards delivering our next generation of products and increasing the cadence in which we will introduce step function technology improvements. I firmly believe that we have the team and the core technologies that will enable us to recover from our current challenges and ultimately return to delivering differentiated financial results.”
Operating cash flow drops significantly
Infinera Corporation has generated cash of $43.40 million from operating activities during the nine month period, down 59.57 percent or $63.96 million, when compared with the last year period.
The company has spent $50.29 million cash to meet investing activities during the nine month period as against cash outgo of $50.90 million in the last year period.
The company has spent $9.80 million cash to carry out financing activities during the nine month period as against cash inflow of $18.39 million in the last year period.
Cash and cash equivalents stood at $131 million as on Sep. 24, 2016, down 18.69 percent or $30.11 million from $161.10 million on Sep. 26, 2015.
Working capital increases
Infinera Corporation has recorded an increase in the working capital over the last year. It stood at $485.33 million as at Sep. 24, 2016, up 11.55 percent or $50.25 million from $435.08 million on Sep. 26, 2015. Current ratio was at 3.35 as on Sep. 24, 2016, up from 3.23 on Sep. 26, 2015.
Cash conversion cycle (CCC) has decreased to 117 days for the quarter from 126 days for the last year period. Days sales outstanding went up to 64 days for the quarter compared with 49 days for the same period last year.
Days inventory outstanding has decreased to 104 days for the quarter compared with 115 days for the previous year period. At the same time, days payable outstanding went up to 52 days for the quarter from 38 for the same period last year.
Debt moves up
Infinera Corporation has witnessed an increase in total debt over the last one year. It stood at $130.92 million as on Sep. 24, 2016, up 6.25 percent or $7.70 million from $123.22 million on Sep. 26, 2015. Infinera Corp has witnessed an increase in long-term debt over the last one year. It stood at $130.92 million as on Sep. 24, 2016, up 6.25 percent or $7.70 million from $123.22 million on Sep. 26, 2015. Total debt was 10.59 percent of total assets as on Sep. 24, 2016, compared with 10.63 percent on Sep. 26, 2015. Debt to equity ratio was almost stable at 0.16 as on Sep. 24, 2016, when compared with the last year.
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