Airspan Networks Holdings Inc.

Airspan reported Q3 2022 revenue of $41.1 million, down 12% sequentially and up 6% year over year. Gross margin was 39.8%, essentially flat versus 41.1% last quarter and down from 40% in Q3 2021. Net loss was $23.3 million versus a $21 million loss in Q2 and a $27 million loss in Q3 2021, while adjusted EBITDA loss was $10 million versus a $12.3 million loss last quarter and a $10.4 million loss a year ago. The company ended the quarter with $27.3 million of cash and $9 million of cash use. For Q4 2022, management guided to revenue of approximately $49 million to $57 million and gross margin of 42% to 46%.

Eric Stonestrom framed the quarter as one of strong demand offset by supply chain friction, saying the company received the largest number of new orders since pre-pandemic periods and saw strong interest in private 5G at trade shows. He emphasized that private networks, Open RAN, hyperscaler partnerships, and broadband stimulus-driven projects are all supporting Airspan’s positioning. His tone was constructive and optimistic, with repeated comments that the business is gaining acceptance and moving closer to breakeven in Q4.

David Brant focused on the financial impact of supply chain delays and the company’s efforts to reduce costs. He said component recommits pushed about $3 million of revenue from Q3 into Q4, gross margin held at 39.8%, and operating expenses were reduced by approximately $4 million in Q3 versus Q2, with about another $1 million of reduction expected in Q4. He also noted $27.3 million of cash at quarter-end, $9 million of cash use in Q3, covenant noncompliance under Fortress agreements, and the pursuit of waivers and other capital sources while debt was classified as current.

Analysts pressed on partnerships, backlog conversion, OpEx sustainability, Gogo timing, macro weakness, and creditor negotiations. Management said Rakuten remains healthy, hyperscaler relationships are strengthening, shippable backlog is over $100 million, fixed wireless bookings should support revenue growth next year, and the OpEx reductions are permanent. On Gogo, Airspan said 5G Aircards should begin shipping in mid-2023 while 4G Aircards continue shipping through 2023; on lenders, management said discussions with Fortress are ongoing and they are optimistic about finding a path through the covenant issue.