HICKORY, N.C. – CommScope Holding Company, Inc. (NASDAQ: COMM), a global leader in infrastructure solutions for communications networks, reported results for the quarter and year ended December 31, 2019. The company reported fourth quarter net sales of $2.30 billion, an increase of 117.3% compared to $1.06 billion during the same period in the prior year. Fourth quarter 2019 included sales of $1.33 billion from ARRIS, which was acquired on April 4, 2019. ARRIS sales in the fourth quarter included a $13.2 million reduction related to deferred revenue purchase accounting adjustments.

CommScope generated a net loss available to common stockholders of $(450.5) million, or $(2.32) per basic share, in the fourth quarter, a decrease from the prior year period's net loss of $(23.3) million, or $(0.12) per basic share. In the fourth quarter of 2019, we recorded $376.1 million of goodwill impairment charges related to our ARRIS reporting units as a result of our annual goodwill impairment test. Non-GAAP adjusted net income for the fourth quarter was $106.6 million, or $0.46 per diluted share, versus $99.8 million, or $0.51 per diluted share, in the fourth quarter of 2018. A summary of reported GAAP results and non-GAAP results is included below.

Net sales in the fourth quarter of 2019 increased 117.3% year over year to $2.30 billion primarily due to the contribution of $1.33 billion from the ARRIS acquisition.

On a combined company basis, net sales decreased 19.2% year over year to $2.30 billion, with lower results across all segments and geographic regions. The decrease was primarily due to lower sales to cable operators. Changes in foreign exchange rates negatively impacted net sales by less than 1%.

Fourth Quarter Segment Overviews
Connectivity Solutions
Segment net sales of $605.9 million decreased 9.1% primarily due to lower sales volumes to cable operators and carriers. Changes in foreign exchange rates negatively impacted segment net sales by less than 1%. Net sales declined in all geographic regions.

Segment net sales of $365.6 million decreased 6.4% primarily due to a pause in spending related to the pending merger of two large telecommunications customers. Changes in foreign exchange rates negatively impacted segment net sales by less than 1%. Net sales declines in the Asia Pacific and CALA regions were partially offset by increases in the EMEA and the North America regions.

Customer Premises Equipment
Segment net sales of $823.6 million decreased 25.1% from the year ago period on a combined company basis primarily due to reduced cable operator spending. Net sales in the quarter included a $1.3 million reduction of revenue related to deferred revenue purchase accounting adjustments. The impact of changes in foreign exchange rates was not significant to segment net sales. Net sales declined in the North America, CALA and EMEA regions, but these declines were slightly offset by increased sales in the Asia Pacific region.

Ruckus
Segment net sales of $137.5 million decreased 9.1% from the year ago period on a combined company basis primarily impacted by a reduction in service provider spend. Net sales in the quarter included a $2.8 million reduction of revenue related to deferred revenue purchase accounting adjustments. The impact of changes in foreign exchange rates was not significant to segment net sales. Net sales declined in all geographic regions.

Outlook
First Quarter 2020 Guidance:

Loss per share of $(0.89) – $(0.88), based on 195 million weighted average basic shares Non-GAAP adjusted earnings per diluted share of $0.03 – $0.18, based on 236 million weighted average diluted shares (assuming the if-converted method is applied for our Series A Convertible Preferred Stock) "Due to the uncertainty regarding the impact of the Coronavirus, we are providing a wider than normal guidance range for the first quarter," said Alex Pease, Executive Vice President and Chief Financial Officer.

CommScope