HICKORY, N.C. – CommScope Holding Company, Inc. (NASDAQ: COMM), a global leader in infrastructure solutions for communications networks, reported results for the quarter ended June 30, 2020.
Second Quarter Results and Comparison
Net sales in the second quarter of 2020 decreased 18.1% year over year to $2.10 billion. On a combined company basis, net sales decreased 19.0% year over year due to reduced spending from cable operators and wireless carriers, primarily in the Home Networks and Outdoor Wireless Networks segments. The Company estimates that net sales were negatively impacted by approximately $50 million due to supply constraints related to COVID-19.
CommScope generated a net loss of $(321.1) million, or $(1.71) per basic share, in the second quarter, compared to the prior year period's net loss of $(334.0) million, or $(1.81) per basic share. Due to indicators of goodwill impairment found in our Home Networks reporting unit during the second quarter of 2020, we performed an interim goodwill impairment test; and we recorded $206.7 million of goodwill impairment charges related to our Home Networks segment during the period. Non-GAAP adjusted net income for the second quarter of 2020 was $76.9 million, or $0.32 per diluted share, versus $152.8 million, or $0.66 per diluted share, in the second quarter of 2019.
Net sales of $671.9 million, relatively unchanged from prior year; both Network Cable & Connectivity and Network & Cloud remained relatively unchanged.
Net sales of $624.0 million, down 31.6% from prior year driven by declines in both Home Media Solutions and Broadband Connectivity Devices.
Outdoor Wireless Networks
Net sales of $328.4 million, down 28.3% from prior year driven by declines in both Macro Tower Solutions and Metro Cell Solutions.
Venue and Campus Networks
Net sales of $478.5 million, down 13.2% from prior year primarily driven by declines in indoor copper and RUCKUS, partially offset by growth in DAS and ONECELL.
Due to the significant and evolving uncertainties related to the impact of the COVID-19 pandemic, CommScope is providing limited financial guidance for 2020.
While the Company is not providing specific guidance for the third quarter, the Company expects its third quarter sales and non-GAAP adjusted EBITDA to improve modestly compared to the second quarter. Additionally, the Company expects sales and non-GAAP adjusted EBITDA to sequentially improve in the fourth quarter.
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