Airspan Networks Holdings Inc.

Third-quarter revenue was $41.1 million, down 12% sequentially and up 6% year over year. Gross margin was 39.8%, essentially flat sequentially and down from 40% in Q3 2021. Net loss was $23.3 million versus $21 million in Q2 and $27 million in Q3 2021; adjusted EBITDA was a loss of $10 million versus a $12.3 million loss in Q2 and a $10.4 million loss a year ago. The company ended the quarter with $27.3 million of cash and said third-quarter cash use was $9 million. For Q4 2022, management guided to revenue of approximately $49 million-$57 million and gross margin of 42%-46%; they also said supply chain constraints and Asia COVID-related disruptions could affect results.

Eric Stonestrom framed the quarter around strong demand, especially in private networks, fixed wireless access, Open RAN, and partnerships with hyperscalers and systems integrators. He emphasized 87 private network project wins, strong trade-show interest, and new product introductions as evidence that Airspan is well positioned to monetize 5G rollout and enterprise automation trends. His tone was upbeat despite acknowledging supply chain setbacks and a slight miss versus the low end of guidance.

David Brant focused on the financial impact of supply chain issues and the company’s effort to reduce costs and improve liquidity. He said about $4 million of operating expense reduction flowed through in Q3, additional reductions should be about $1 million in Q4, and customer receivables were being accelerated to support working capital. He also disclosed covenant noncompliance under the Fortress credit agreement and convertible note agreement, said debt was classified as current, and noted the company ended Q3 with $27.3 million of cash after $9 million of cash use.

Analysts focused on partnerships, bookings conversion, OpEx, Gogo timing, macro demand, and lender discussions. Management said Rakuten remains a healthy Open RAN relationship with continued purchase commitments, hyperscaler partnerships are strengthening and contributing to private network scale, and over $100 million of shippable backlog should convert into revenue over the next 2-3 quarters. On financing, management said discussions with Fortress are ongoing, the relationship is good, and they are seeking a solution to covenant breaches in the coming weeks.