Iridium (IRDM) to Report Q2 Earnings: What's in the Offing?
Iridium Communications IRDM is slated to release second-quarter 2023 results on Jul 25, before market open.
The Zacks Consensus Estimate for earnings per share (EPS) is pegged at 3 cents, unchanged in the past 30 days. In the year-ago quarter, the company reported EPS of 4 cents. The consensus estimate for revenues is pegged at $197.3 million, suggesting year-over-year growth of 12.8%.
Over the trailing four quarters, the company has an average surprise of 250%.
Iridium Communications Inc Price and EPS Surprise
Iridium Communications Inc price-eps-surprise | Iridium Communications Inc Quote
Factors at Play
Iridium’s second-quarter performance is likely to have benefited from momentum in Subscriber Equipment and Engineering and Support Service segments. The Engineering and Support Service segment is anticipated to have gained from increased commercial and government activities.
The company’s commercial service revenues are likely to have benefited from growth in the Internet of Things (IoT), ongoing activations and solid uptake of its broadband services. Our estimate for revenues from the company’s commercial service is pegged at $118.4 million, representing a rise of 11.3% year over year.
IRDM’s recurring service revenue base, driven by robust subscriber growth and mobile penetration, lends it a competitive edge and is anticipated to have driven its second-quarter performance. As of Mar 31, 2023, the company had 2,051,000 billable subscribers, up 15% compared with 1,781,000 at the end of the prior-year quarter. The year-over-year increase was backed by strength in commercial IoT.
Our estimate for quarterly revenues from Services (which accounts for a significant chunk of total revenues) is pegged at $145 million, indicating a rise of 9.1% from the year-ago quarter’s levels.
Our estimate for quarterly revenues from Subscriber Equipment segment is pegged at $33.4 million, indicating a decrease of 0.9% year over year. Our estimate for revenues from the Engineering and Support Service segment is pegged at $17.2 million, up 107% from the prior-year quarter’s levels.
However, global macroeconomic weakness, inflation and supply-chain disruptions are likely to have acted as headwinds for Iridium’s second-quarter revenues. Rising research and development costs due to new product development are likely to have affected the company’s margins.
What Our Model Says
Our proven model predicts an earnings beat for Iridium this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, this is exactly the case here.
Earnings ESP: Iridium has an Earnings ESP of +25.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Iridium currently carries a Zacks Rank #2.
Other Stocks to Consider
Here are some stocks you may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
Tyler Technologies TYL has an Earnings ESP of +0.54% and currently sports a Zacks Rank #1. TYL is scheduled to report quarterly numbers on Jul 26. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for TYL’s to-be-reported quarter’s earnings and revenues is pegged at $1.86 per share and $490.7 million, respectively. Shares of TYL have rallied 20.8% in the past year.
Meta Platforms META has an Earnings ESP of +6.56% and currently carries a Zacks Rank #2. META is set to report its second-quarter 2023 results on Jul 26.
The Zacks Consensus Estimate for META’s to-be-reported quarter’s earnings and revenues is pegged at $2.85 per share and $30.8 billion, respectively. Shares of META have gained 159.3% year to date.
Cadence Design Systems CDNS has an Earnings ESP of +0.67% and currently sports a Zacks Rank #1. CDNS is scheduled to report earnings on Jul 24.
The Zacks Consensus Estimate for CDNS’s to-be-reported quarter’s earnings and revenues is pegged at $1.18 per share and $973.2 million, respectively. Shares of CDNS have gained 55.3% in the past year.
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Meta Platforms, Inc. (META) : Free Stock Analysis Report
