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Calix Inc (CALX)
NYSE:CALX
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Calix
(NYSE:CALX)
60Neutral
Positive Factors
Earnings and Guidance
CALX beat consensus on 4Q24 results and 1Q25 guidance.
Market Opportunities
Management relayed confidence in re-accelerating growth driven by private equity broadband funding and increasing demand from medium and large customer segments.
Market Positioning
CALX is uniquely positioned to benefit from the rural fiber build due to low competitive concerns and a focus on fiber deployments.
Negative Factors
Financial Concerns
It's hard to justify a bigger premium given the size of their stock compensation expense.
Market Challenges
A slowing/maturing end market remains a concern.
Revenue Weakness
Continued weakness in 3Q revenue stemmed primarily from its large and medium-sized customer segments, collectively -50% y/y.
Calix (CALX) vs. S&P 500 (SPY)
Market Cap
$2.36B
Dividend YieldN/A
Average Volume (3M)730.25K
Price to Earnings (P/E)―
Beta (1Y)1.14
Revenue Growth-20.02%
EPS Growth-193.84%
CountryUS
Employees1,820
SectorTechnology
Sector Strength42
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.45
Shares Outstanding66,648,720
10 Day Avg. Volume794,655
30 Day Avg. Volume730,246
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.88
Price to Cash Flow (P/CF)38.90
P/FCF Ratio58.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$47.71Price Target Upside35.27% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
Calix Business Overview & Revenue Model
Company DescriptionCalix, Inc., together with its subsidiaries, provides cloud and software platforms, and systems and services in the United States, rest of Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company's cloud and software platforms, and systems and services enable broadband service providers (BSPs) to provide a range of services. It provides Calix Cloud platform, a role-based analytics platform comprising Calix Marketing Cloud, Calix Support Cloud, and Calix Operations Cloud, which are configurable to display role-based insights and enable BSPs to anticipate and target new revenue-generating services and applications through mobile application. The company also offers EXOS, a carrier class premises operating system and fully integrated with its GigaSpire family of systems to be ready for deployment as a complete subscriber experience solutions for BSP's residential and business subscribers; and AXOS, a software platform to access edge of the network by its architecture and operations. It offers its products through its direct sales force and resellers. Calix, Inc. was incorporated in 1999 and is headquartered in San Jose, California.
How the Company Makes MoneyCalix generates revenue primarily through the sale of its software platforms, systems, and professional services to broadband service providers. The company's revenue streams include the sale of access systems and software licenses, as well as services such as maintenance, support, and training. Calix also earns money through subscriptions to its cloud-based solutions, which provide network management, analytics, and subscriber experience management tools. Key factors contributing to its earnings include the increasing demand for high-speed internet and the ongoing digital transformation efforts by broadband service providers. Calix's strategic partnerships with leading telecommunications companies further bolster its revenue by expanding its market reach and facilitating the adoption of its solutions.
Calix Financial Statement Overview
Summary
Calix shows resilience in managing debt with a strong balance sheet and zero debt. However, operational challenges are evident with recent losses and fluctuating revenue. The company needs to focus on restoring profitability and achieving consistent cash flow growth to enhance its financial health.Income Statement
Calix experienced fluctuating revenue with a notable decline from 2023 to 2024. The gross profit margin remains healthy; however, the company reported a negative EBIT and net income in 2024, indicating operational challenges. Previous years showed profitability, suggesting potential recovery if managed effectively.55
Neutral
Balance Sheet
The balance sheet is strong with zero debt in 2024, enhancing financial stability. The equity ratio is robust, indicating high asset coverage by equity. Despite these strengths, the declining stockholders' equity from 2023 suggests potential risks in maintaining financial health.65
Positive
Cash Flow
Operating cash flow improved in 2024, and the company maintains positive free cash flow, indicating efficient management of cash resources. However, the free cash flow growth rate is inconsistent, reflecting potential volatility in cash generation.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 831.52M | 1.04B | 867.83M | 679.39M | 541.24M | Gross Profit |
| 453.59M | 518.32M | 435.43M | 356.59M | 267.02M | EBIT |
| -43.03M | 25.59M | 52.61M | 73.94M | 36.85M | EBITDA |
| -43.03M | 42.22M | 66.92M | 91.17M | 52.69M | Net Income Common Stockholders |
| -29.75M | 29.32M | 41.01M | 238.38M | 33.48M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 297.09M | 220.35M | 241.72M | 204.34M | 133.79M | Total Assets |
| 939.27M | 941.87M | 884.84M | 742.03M | 427.35M | Total Debt |
| 8.02M | 11.56M | 12.39M | 12.38M | 12.95M | Net Debt |
| -35.14M | -51.85M | -66.68M | -38.96M | -67.86M | Total Liabilities |
| 158.33M | 222.88M | 205.27M | 173.60M | 147.03M | Stockholders Equity |
| 780.94M | 718.98M | 679.57M | 568.43M | 280.32M |
| Cash Flow | Free Cash Flow | |||
| 50.35M | 38.40M | 13.12M | 46.33M | 43.59M | Operating Cash Flow |
| 68.40M | 56.25M | 27.18M | 56.79M | 51.41M | Investing Cash Flow |
| -109.53M | -6.25M | -24.08M | -110.66M | -60.80M | Financing Cash Flow |
| 20.90M | -65.93M | 25.06M | 24.38M | 42.15M |
Calix Technical Analysis
Negative
35.27
Price Trends
37.10
Negative
35.72
Negative
36.27
Negative
Market Momentum
-0.20
Negative
47.79
Neutral
37.12
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CALX, the sentiment is Negative. The current price of 35.27 is above the 20-day moving average (MA) of 34.24, below the 50-day MA of 37.10, and below the 200-day MA of 36.27, indicating a neutral trend. The MACD of -0.20 indicates Negative momentum. The RSI at 47.79 is Neutral, neither overbought nor oversold. The STOCH value of 37.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CALX.
Calix Risk Analysis
Calix disclosed 39 risk factors in its most recent earnings report. Calix reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Calix Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $2.22B | 39.97 | 12.70% | 1.21% | 12.85% | -16.89% | |
63 Neutral | $2.19B | 31.99 | 7.50% | ― | 15.16% | -15.16% | |
61 Neutral | $2.49B | ― | -5.53% | ― | -0.67% | -856.71% | |
60 Neutral | $2.36B | ― | -3.97% | ― | -20.02% | -193.84% | |
60 Neutral | $2.25B | ― | 16.58% | ― | 8.99% | 63.84% | |
57 Neutral | $20.94B | 10.43 | -13.41% | 2.52% | 4.53% | -23.34% | |
46 Neutral | $2.14B | ― | -20.89% | ― | 25.78% | 32.95% |
* Technology Sector Average
Performance Comparison
CALX
Calix
35.27
3.18
9.91%
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Formfactor
28.73
-17.45
-37.79%
PRGS
Progress Software
58.98
7.71
15.04%
AMBA
Ambarella
51.39
1.74
3.50%
RNG
RingCentral
25.86
-7.39
-22.23%
VIAV
Viavi Solutions
11.41
2.38
26.36%
Calix Earnings Call Summary
Earnings Call Date: Jan 29, 2025 | % Change Since: -4.34% | Next Earnings Date: Apr 21, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth, record gross margins, and new customer wins, showcasing the company's strategic progress. However, attention was drawn to potential margin pressure and uncertainty regarding government programs. Overall, the positive aspects, such as growth in RPOs and new customer acquisitions, outweigh the concerns.Highlights
Strong Revenue and Growth in RPOs
Fourth quarter revenue reached $206 million, at the high end of guidance, with a sequential quarterly growth of 2.6%. RPOs (Remaining Performance Obligations) grew 10% sequentially to $326 million and increased 34% year-over-year.
Record Non-GAAP Gross Margin
Achieved a record non-GAAP gross margin of 55.5% in the fourth quarter, driven by strong demand for Platform Cloud and managed services.
New Customer Wins
Added 18 new ESP customers in Q4, with the majority being competitive takeaways. Additionally, 21 customers adopted the platform, and 32 customers deployed managed services for the first time.
Strong Balance Sheet
Ended the year with record cash and investments of $297 million. Inventory turns were strong at 3.1, exceeding the target range when excluding component inventory.
Lowlights
Margin Pressure from Mix Shift
Guidance indicates that non-GAAP gross margin improvement for 2025 will be at the lower end of the target financial model due to a mix shift towards subscriber systems.
Uncertainty in Government Program Impact
Concerns over potential risks from government programs were mentioned, although currently considered 'noise' with no substantial impact yet.
Company Guidance
During the Calix Fourth Quarter 2024 earnings call, the company provided optimistic guidance for the upcoming fiscal year. They reported strong fourth-quarter revenue of $206 million, which was at the high end of their guidance range and marked a 2.6% sequential growth. The demand for Platform Cloud and managed services was robust, as evidenced by a 10% sequential increase in Remaining Performance Obligations (RPOs) to $326 million, representing a 34% year-over-year growth. The company achieved a record non-GAAP gross margin of 55.5% in Q4. For Q1 2025, Calix anticipates revenue between $204 million and $210 million, with a flat to slightly increased non-GAAP gross margin due to product mix. They expect annual gross margin improvement at the lower end of their target financial model of 100 to 200 basis points. Calix also plans to keep operating expenses flat to slightly up in 2025 compared to 2024. Their strategic focus remains on expanding their footprint, landing new broadband service providers, and consistently expanding their platform, cloud, and managed services, helping their customers transform into broadband experience providers.Calix Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Calix Appoints Mike Berry to Board Amid Strategic Shift
Positive
Mar 27, 2025
On March 21, 2025, Ellie Fields announced she would not seek re-election to the Calix board of directors, as she plans to focus on an AI startup. Calix has nominated Mike Berry, a seasoned finance executive with experience at companies like NetApp, to join the board. Berry’s expertise is expected to support Calix’s growth and innovation in the broadband industry, aligning with its strategy to expand its platform, cloud, and managed services model. This transition reflects Calix’s commitment to leveraging industry veterans to enhance its market positioning and drive long-term success.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.