CAMP Stock Rebounds Strongly As Q1 Results Beat Estimates

CAMP stock

CAMP stock is recovering from the recent slump as CalAmp Corp (NASDAQ:CAMP) reported better than estimated first-quarter results.

CalAmp Corp succumbed to a net loss in the first quarter of fiscal 2020 as sales also tumbled. While the disappointing results met analyst’s expectations, they raise serious concerns about the wireless company’s growth metrics.

Q1 Financial Results

CAMP succumbed to non-recurring legal expenses and purchase accounting adjustments on its way to reporting a net loss of $8.69 million or $0.26 a share. Last year, same quarter, the company generated a net profit of $8.51 million or $0.23 a share.

Revenue in the quarter was down 6%, coming in at $89.1 million, which was attributed to a decline in Telematics system product sales. In defense of the first quarter financial results, the Chief Executive Officer, Michael Burdiek, has touted record software and subscription service revenues as well as improved supply chain preface. CAMP software and subscriptions revenues were up 38% to $25.5 million, attributed to the impact of acquisitions.

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Telematics system revenue was down 17% to $63.6 million. CAMP’s subscription base increased to 1.2 million in the quarter, attributed to the recent acquisition of Car Track (Mexico), Synovia Solutions (UK), and Tracker Network (UK).

CAMP stock is up 13.50% and now trading at $11.80. The stock made a new 52-week low $9.95 earlier this week.

Q1 Business Highlights

During the quarter, the company also secured a large SaaS contract valued at $10 million. The company also inked a partnership with Cryoport for the supply of advanced supply chain visibility solutions. Another strategic partnership was with Dogo Informatique to expand access to a fleet of supply and chain management systems.

“The integration of our recent acquisitions is progressing well with identified incremental revenue synergies that we believe will further bolster our Software-as-a-Service (“SaaS”) business expansion toward our targeted quarterly run-rate of more than $30 million exiting the year,” explained Mr. Burdiek.

Buoyed by the milestones achieved in the first quarter, CAMP is projecting revenues in the range of $89.5 million–$94.5 million in Q2. Revenue outlook in the quarter underscores momentum across the company’s Software as a Service business in addition to growth in the Telematics system business.

After today’s rise, CAMP stock is still down 15% since the beginning of the year.

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