Adtran (ADTN, Financial) has introduced its new AINetwork Cloud-interconnect solution, a cutting-edge fiber networking platform tailored for hyperscalers, federal agencies, SLED organizations, and enterprises aiming to expand AI services. This platform integrates with Dell's AI Factory, offering the capability to dynamically adjust optical networking capacity to accommodate real-time AI workloads. This ensures seamless and high-speed connectivity across data centers and from the core network to the edge.
Furthermore, the solution facilitates the creation of tokenized, sovereign AI networks, allowing dynamic compute allocation. This empowers organizations to expand their AI initiatives with enhanced autonomy, control, and cost-effectiveness. Adtran's innovation represents a significant step forward in supporting rapidly scaling AI activities in a variety of sectors.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 5 analysts, the average target price for Adtran Holdings Inc (ADTN, Financial) is $12.00 with a high estimate of $15.00 and a low estimate of $9.00. The average target implies an upside of 55.64% from the current price of $7.71. More detailed estimate data can be found on the Adtran Holdings Inc (ADTN) Forecast page.
Based on the consensus recommendation from 7 brokerage firms, Adtran Holdings Inc's (ADTN, Financial) average brokerage recommendation is currently 2.4, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Adtran Holdings Inc (ADTN, Financial) in one year is $8.41, suggesting a upside of 9.08% from the current price of $7.71. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Adtran Holdings Inc (ADTN) Summary page.
ADTN Key Business Developments
Release Date: May 08, 2025
- Revenue: $247.7 million, a year-over-year increase of $21.6 million or approximately 10%.
- Non-GAAP Gross Margin: 42.6%, an increase of 146 basis points sequentially and 193 basis points year over year.
- Non-GAAP Operating Profit: $10.1 million or 4.1% of revenue, above the high end of guidance.
- Cash from Operations: $41.6 million, up from $4.6 million in Q4 2024.
- Free Cash Flow: $22.9 million, a turnaround from negative $10.4 million in Q4 2024.
- Access and Aggregation Revenue: $89.1 million, 10% year-over-year increase.
- Optical Networking Solutions Revenue: $78.2 million, 4% year-over-year increase.
- Subscriber Solutions Revenue: $80.4 million, 15% year-over-year increase.
- Non-GAAP Net Earnings: $2.4 million or $0.03 per share.
- Inventory Levels: $254.1 million, a decrease of $7.6 million sequentially.
- Cash and Cash Equivalents: $101.3 million, a sequential increase of $23.8 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Adtran Holdings Inc (ADTN, Financial) reported a strong first quarter with revenue of $247.5 million, exceeding the midpoint of their guidance.
- The company achieved year-over-year growth across all three product categories: access and aggregation, optical networking solutions, and subscriber solutions.
- Adtran Holdings Inc (ADTN) generated a robust $41.6 million in cash from operations and $22.9 million in free cash flow.
- The company has a strong presence in Europe, with significant customer wins and expansion in the region.
- Adtran Holdings Inc (ADTN) is well-positioned to adapt to evolving trade policies due to its global customer base and diverse supply chain.
Negative Points
- The company faces potential margin pressure in the second quarter due to foreign exchange headwinds from a weaker US dollar.
- There is uncertainty surrounding the impact of tariffs and global trade policies on Adtran Holdings Inc (ADTN)'s operations.
- The US market showed relatively stable performance compared to stronger growth in Europe, indicating potential regional disparities.
- Adtran Holdings Inc (ADTN) is still in the process of monetizing non-core assets, including corporate real estate, which has taken longer than anticipated.
- The company is experiencing elevated operating expenses, primarily driven by foreign exchange fluctuations.
