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iRobot (IRBT) Q4 Earnings Miss Estimates, Revenues Beat

iRobot Corporation IRBT reported mixed fourth-quarter 2022 results.

The company’s adjusted loss in the reported quarter was $1.82 per share, wider than the Zacks Consensus Estimate of a loss of 33 cents. Also, the quarterly loss compared unfavorably with a loss of $1.21 per share recorded in the year-ago quarter.

Revenue Details

iRobot generated revenues of $357.8 million in the reported quarter, beating the Zacks Consensus Estimate of $299 million by 19.7%. On a year-over-year basis, revenues decreased 21.4% due to lower orders from retailers and distributors in North America and EMEA.

Sales derived from premium and mid-tier robots accounted for 84% of IRBT’s total robot revenues, higher than 81% in the year-ago quarter.

Sales generated from the e-commerce platform (representing 55% of the reported quarter’s revenues) decreased 17% year over year. The e-commerce platform includes online sources of retailers, IRBT’s app and website, as well as e-commerce websites. Direct sales to consumers were up 7% year over year to $73 million.

Total product units of 1,335 thousand shipped in the quarter reflected a year-over-year decrease of 19.4%, while average selling prices increased 2.8%. For vacuum products, revenues of $331 million reflected a decline of 18.9% from the year-ago quarter. Units shipped were 1213 thousand, down 18% from the prior-year quarter. Revenues from mopping products decreased 42.6% to $27 million. Units shipped were 122 thousand, down from 177 thousand recorded in the year-ago quarter.

On a regional basis, iRobot sourced 49% of revenues from domestic operations and the rest came from the international arena. Domestic revenues totaled $175.5 million, reflecting a 22.3% decline from the year-ago quarter. International revenues declined 20.5% to $182.4 million.

iRobot Corporation Price, Consensus and EPS Surprise

 

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iRobot Corporation price-consensus-eps-surprise-chart | iRobot Corporation Quote

Margin Profile

In the quarter under review, iRobot’s cost of revenues decreased 17.3% to $272.6 million, representing 76.2% of revenues compared with 72.4% in the year-ago quarter. Adjusted gross profit was $86.6 million, down 31.6% year over year, while the adjusted gross margin decreased 360 basis points to 24.2%.

Research and development expenses were $40.6 million, up 0.2% year over year. This accounted for 11.3% of revenues compared with 8.9% in the year-ago quarter. Selling and marketing expenses decreased 6.9% to $96 million. As a percentage of revenues, it was 26.8% for the reported quarter compared with 22.6% in the prior-year period. General and administrative expenses were $33.5 million, up 25.9% year over year. The figure mirrored 9.3% of the total revenue base compared with 5.8% in the year-earlier quarter.

In the fourth quarter, iRobot recorded an adjusted operating loss of $61.6 million compared to an operating income of $33.6 million in the year-ago period. The adjusted operating margin was (17.2%) versus (7.4%) in the year-ago quarter.

Balance Sheet and Cash Flow

While exiting fourth-quarter 2022, iRobot had cash and cash equivalents of $117.9 million, decreasing 41.5% from $201.5 million recorded at the end of fourth-quarter 2021. Total long-term liabilities were $63.5 million, down 11.8% from the figure recorded at the end of fourth-quarter 2021.

In 2022, iRobot used net cash of $90 million for operating activities compared with net cash of $32 million used in the prior-year period. Capital used for purchasing property and equipment totaled $12.3 million, decreasing 58.9%.

Zacks Rank & Stocks to Consider

IRBT currently has a Zacks Rank #3 (Hold). Some better-ranked companies from the Industrial Products sector are discussed below:

Allegion plc ALLE presently carries a Zacks Rank #2 (Buy). ALLE’s earnings surprise in the last four quarters was 8.8%, on average. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks.

In the past 60 days, Allegion’s earnings estimates have remained steady for 2022. The stock has gained 10.5% in the past six months.

A. O. Smith Corporation AOS presently carries a Zacks Rank of 2 and a trailing four-quarter earnings surprise of 3.2%, on average.

AOS’ earnings estimates have increased 3.1% for 2023 in the past 60 days. Shares of A. O. Smith have risen 4.9% in the past six months.

Valmont Industries, Inc. VMI presently has a Zacks Rank of 2. VMI’s earnings surprise in the last four quarters was 12.5%, on average.

In the past 60 days, Valmont’s earnings estimates have increased by a penny. The stock has rallied 12.9% in the past six months.

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Valmont Industries, Inc. (VMI) : Free Stock Analysis Report

A. O. Smith Corporation (AOS) : Free Stock Analysis Report

iRobot Corporation (IRBT) : Free Stock Analysis Report

Allegion PLC (ALLE) : Free Stock Analysis Report

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