Adtran Networks, a German telecommunications-equipment company, has revised its outlook for the year due to various factors including lower order bookings and consumer spending being impacted by inflation and high interest rates.
The company now expects a decline in revenue ranging from high single-digit to low-teens percentage. This is a significant adjustment from their previous forecast of growth in the high single-digit to low double-digit percentage range.
Inventory Optimization Impact
Adtran Networks highlighted the impact of reduced lead times for components, which has led many customers to focus on optimizing their inventory. This optimization has affected their order bookings.
Pro-Forma Earnings Projection
The company forecasts a pro-forma earnings before interest and taxes (EBIT) margin in the low single-digit percentage range. This is a change from their previous expectation of a further increase compared to the previous year's performance.
Adtran Networks reported that its second-quarter results were in line with expectations. The company achieved a pro-forma operating profit margin of 7.1% for the quarter, an increase from 3.9% in the same period last year. The revenue for the quarter reached 170.2 million euros ($187.4 million), marking a 2.3% growth.
Adtran Networks is set to publish its detailed second-quarter report on Tuesday.