NATICK, Mass., Oct. 30, 2024 /PRNewswire/ — Cognex Corporation (NASDAQ: CGNX) today reported financial results for the third quarter of 2024. Table 1 below shows selected financial data for Q3-24 compared with Q3-23 and Q2-24.
“Cognex generated third quarter revenue and adjusted EBITDA margin in line with our guidance,” said Robert J. Willett, CEO. “Revenue grew year-on-year on both a reported basis and excluding Moritex, led by continued strength in our Logistics and Semiconductor end markets. However, conditions across our broader factory automation business remain soft, with a further step-down in Automotive.”
Mr. Willett continued, “We made good strides in innovation, rolling out additional out-of-the-box AI features that are enhancing our products. We also continue to see our Emerging Customer initiative ramp well and attract many new customers.”
Dennis Fehr, CFO, added, “In this prolonged soft macro environment, we tightly managed costs and working capital. Despite a ramp in strategic investments, we delivered a sequential decrease in operating expenses. Combined with working capital efficiencies, this led to our highest quarterly operating cash flow and free cash flow since Q4-2022.”
Table 1
(Dollars in millions, except per share amounts)
Current
Quarter
Q3-24
Prior Year
Quarter
Q3-23
Y/Y
Change
Prior
Quarter
Q2-24
Q/Q
Change
Revenue
$235
$197
+19 %
$239
-2 %
Operating Income
$32
$31
+3 %
$38
-18 %
% of Revenue
13.4 %
15.5 %
(209 bps)
16.1 %
(262 bps)
Adjusted EBITDA*
$41
$34
+20 %
$48
-13 %
% of Revenue
17.6 %
17.4 %
+19 bps
19.9 %
(232 bps)
Net Income per Diluted Share
$0.17
$0.11
+57 %
$0.21
-18 %
Adjusted EPS (Diluted)*
$0.20
$0.17
+19 %
$0.23
-13 %
Note: Numbers shown may not foot due to rounding.
*Adjusted EBITDA and Adjusted EPS (Diluted) exclude Non-GAAP adjustments. A reconciliation from GAAP to Non-GAAP metrics is provided in this news release.
Details of the Quarter
Statement of Operations Highlights – Third Quarter of 2024
Balance Sheet and Cash Flow Highlights – September 29, 2024
Financial Outlook – Fourth Quarter of 2024
1Cognex has provided the forward-looking non-GAAP measures of adjusted gross margin, adjusted EBITDA margin, and adjusted effective tax rate, but cannot, without unreasonable effort, forecast such items to present or provide a reconciliation to corresponding forecasted GAAP measures. These include special items such as restructuring charges, acquisition and integration charges, and amortization of acquisition-related intangible assets, all of which are subject to limitations in predictability of timing, ultimate outcome and numerous conditions outside of Cognex’s control. Additionally, these items are outside of Cognex’s normal business operations and not used by management to assess Cognex’s operating results. Cognex believes these limitations would result in a range of projected values so broad as to not be meaningful to investors. For these reasons, Cognex believes that the probable significance of such information is low. Information with respect to special items for certain historical periods is included in the section entitled “Reconciliation of Selected Items From GAAP to Non-GAAP”.
Analyst Conference Call and Simultaneous Webcast
COGNEX CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands)
September 29,
2024
December 31,
2023
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$ 197,075
$ 202,655
Current investments, amortized cost of $91,658 and $132,799 in 2024 and 2023,
respectively, allowance for credit losses of $0 in 2024 and 2023
90,803
129,392
Accounts receivable, allowance for credit losses of $604 and $583 in 2024 and 2023,
respectively
157,968
114,164
Unbilled revenue
2,117
2,402
Inventories
155,278
162,285
Prepaid expenses and other current assets
68,841
68,099
Total current assets
672,082
678,997
Non-current investments, amortized cost of $318,268 and $250,790 in 2024 and 2023,
respectively, allowance for credit losses of $0 in 2024 and 2023
319,287
244,230
Property, plant, and equipment, net
103,177
105,849
Operating lease assets
72,433
75,115
Goodwill
391,673
393,181
Intangible assets, net
102,550
112,952
Deferred income taxes
395,205
400,400
Other assets
6,840
7,088
Total assets
$ 2,063,247
$ 2,017,812
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$ 29,984
$ 21,454
Accrued expenses
76,675
72,374
Accrued income taxes
24,226
16,907
Deferred revenue and customer deposits
30,045
31,525
Operating lease liabilities
9,806
9,624
Total current liabilities
170,736
151,884
Non-current operating lease liabilities
67,375
68,977
Deferred income taxes
230,368
246,877
Reserve for income taxes
26,491
26,685
Non-current accrued income taxes
—
18,338
Other liabilities
1,251
299
Total liabilities
496,221
513,060
Commitments and contingencies (Note 10)
Shareholders’ equity:
Preferred stock, $.01 par value – Authorized: 400 shares in 2024 and 2023,
respectively; no shares issued and outstanding
—
—
Common stock, $.002 par value – Authorized: 300,000 shares in 2024 and 2023,
respectively; issued and outstanding: 171,515 and 171,599 shares in 2024 and 2023,
respectively
343
343
Additional paid-in capital
1,076,363
1,037,202
Retained earnings
527,909
512,543
Accumulated other comprehensive loss, net of tax
(37,589)
(45,336)
Total shareholders’ equity
1,567,026
1,504,752
Total liabilities and shareholders’ equity
$ 2,063,247
$ 2,017,812
COGNEX CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three-months Ended
Nine-months Ended
September 29,
2024
October 1,
2023
September 29,
2024
October 1,
2023
Revenue
$ 234,742
$ 197,241
$ 684,831
$ 640,877
Cost of revenue
75,343
54,467
216,896
174,680
Gross margin
159,399
142,774
467,935
466,197
Percentage of revenue
67.9 %
72.4 %
68.3 %
72.7 %
Research, development, and engineering expenses
35,210
32,580
107,277
104,707
Percentage of revenue
15.0 %
16.5 %
15.7 %
16.3 %
Selling, general, and administrative expenses
92,625
82,307
276,433
248,767
Percentage of revenue
39.5 %
41.7 %
40.4 %
38.8 %
Loss (recovery) from fire
—
(2,750)
—
(5,250)
Operating income
31,564
30,637
84,225
117,973
Percentage of revenue
13.4 %
15.5 %
12.3 %
18.4 %
Foreign currency gain (loss)
1,221
(8,699)
1,086
(9,910)
Investment income
3,561
4,891
9,797
12,573
Other income (expense)
209
173
581
358
Income before income tax expense
36,555
27,002
95,689
120,994
Income tax expense
6,964
8,086
17,864
18,989
Net income
$ 29,591
$ 18,916
$ 77,825
$ 102,005
Percentage of revenue
12.6 %
9.6 %
11.4 %
15.9 %
Net income per weighted-average common and common-equivalent share:
Basic
$ 0.17
$ 0.11
$ 0.45
$
