Synchronoss Stock Falls as Q3 Earnings & Revenues Miss Estimates

Sea Limited SE reported adjusted earnings of 54 cents per share in the third quarter of 2024, missing the Zacks Consensus Estimate by 8.47%. It had posted earnings of 6 cents in the year-ago quarter.

SE’s earnings lagged the Zacks Consensus Estimate in the trailing four quarters, the average negative earnings surprise being 55.54%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Revenues of $4.3 billion increased 30.8% on a year-over-year basis, beating the Zacks Consensus Estimate by 3.59%. The uptick was primarily driven by growth in Gross Merchandise Value (GMV) for e-commerce and the credit business.

Sea Limited Sponsored ADR Price, Consensus and EPS Surprise

Sea Limited Sponsored ADR price-consensus-eps-surprise-chart | Sea Limited Sponsored ADR Quote

Shares jumped 10.46% to close at $107.65 on Nov. 12 following the third-quarter 2024 results. Sea Limited’s shares have surged 164.7% year to date compared with the Zack Computer and Technology sector’s rise of 29.5%.

SE’s Top-Line Details

Digital Entertainment revenues were $497.8 million, marking a year-over-year decline of 15.9%.

Quarterly active users were 628.5 million, up 15.5% year over year.

Quarterly paying users of 50.2 million increased 23.9% year over year. The paying user ratio was 8% in the second quarter compared with 7.5% in the year-ago quarter.

Average bookings per user in the reported quarter were 89 cents compared with 82 cents in the year-ago quarter.

Garena segment reported strong growth in the third quarter, with total bookings reaching $556.5 million, marking a 24.3% year-over-year increase, driven by Free Fire and above 100 million daily active users.

E-commerce and other services’ revenues totaled $3.4 billion, up 41.2% year over year.

The uptick was driven by the robust performance in Shopee, with gross orders rising 24.2% and GMV growing 25.2% year over year.

Shopee segment maintained its market leadership in Asia, with average monthly active buyers increasing more than 20% year over year in the third quarter.

Sales of goods increased 38.9% year over year to $418 million in the third quarter of 2024.

Digital Financial Services’ revenues increased 38% year over year to $615.7 million. The uptick was driven by strong growth in its loan book, which reached $4.6 billion, up 73.2%.

Non-performing loans over 90 days were stable at 1.2% of total consumer and SME loans in the reported quarter.

Sea Limited’s Operating Details

Gross profit increased 29.1% year over year to $1.86 billion in the third quarter of 2024.

Adjusted EBITDA was $521.3 million compared with an EBITDA of $35.3 million in the year-ago quarter.

Digital Entertainment's adjusted EBITDA was $314.4 million, rising 34.4% from $234 million in the year-ago quarter.

E-commerce adjusted EBITDA was $34.4 million against a loss of $346.5 million incurred in the year-ago quarter.

Digital Financial Services adjusted EBITDA reached $187.9 million, up 13.4% year-over-year from $165.7 million.

SE’s Balance Sheet & Cash Flow

As of Sept. 30, 2024, SE had cash and cash equivalents of $2.54 billion compared with $2.64 billion as of June 30, 2024.

The company generated $1.17 million in cash from operating activities in the reported quarter compared with $0.62 million in the previous quarter.

Sea Limited’s Zacks Rank & Stocks to Consider

Currently, SE has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Computer & Technology sector are CyberArk Software CYBR, Palo Alto Networks PANW and Bilibili BILI. CyberArk Software sports a Zacks Rank #1 (Strong Buy), and Palo Alto and Bilibili each carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

CyberArk Software’s shares have lost 39.7% in the year-to-date period. CYBR is set to report third-quarter 2024 results on Nov. 13.

Palo Alto Networks’ shares have jumped 35% year to date. PANW is set to report first-quarter fiscal 2025 results on Nov. 20.

Bilibili’s shares have gained 72.8% year to date. BILI is set to report third-quarter 2024 results on Nov. 14.

Zacks Investment Research

Skyworks Solutions SWKS reported non-GAAP earnings of $1.55 per share in fourth-quarter fiscal 2024, beating the Zacks Consensus Estimate by 1.97% and declining 29.5% year over year.

Revenues of $1.02 billion dipped 15.9% on a year-over-year basis but surpassed the consensus mark by 0.31%.

Mobile revenues contributed nearly 65% to total revenues and increased 21% sequentially. This growth was attributed to the normalization of customer orders and inventory levels, as well as support for seasonal product ramps.

In the fourth quarter of fiscal 2024, Skyworks gained design wins in 5G for premium Android smartphones and increased its Wi-Fi 7 pipeline with major partners like Linksys, Charter, and NETGEAR.

Skyworks Solutions, Inc. Price, Consensus and EPS Surprise

Skyworks Solutions, Inc. price-consensus-eps-surprise-chart | Skyworks Solutions, Inc. Quote

The company expanded in automotive for 5G front-end modules, infotainment, and digital isolators, showing increased design win momentum.

Broad markets contributed nearly 35% to total revenues and up $1 million sequentially. It showed signs of stabilization with demand in edge IoT and automotive electrification, supported by increasing adoption of Wi-Fi 6E and Wi-Fi 7 systems.

SWKS’s shares have lost 22.6% against the Zacks Computer and Technology sector’s rise of 39.7% year to date.

Skyworks was hurt by high inventory levels, uneven demand across segments, and muted global demand in automotive and industrial markets. These factors may put downward pressure on SWKS’s shares.

SWKS Operating Details

Non-GAAP gross margin contracted 70 basis points (bps) on a year-over-year basis to 46.5%.

Research & development expenses, as a percentage of revenues, increased 390 bps year over year to 16%.

Selling, general and administrative expenses increased 120 bps to 7.2% in the reported quarter.

Non-GAAP operating margin contracted 600 bps on a year-over-year basis to 26.7% in the reported quarter.

SWKS Balance Sheet & Cash Flow

As of Sept. 27, 2024, cash & cash equivalents and marketable securities were $1.57 billion compared with $1.28 billion as of June 28, 2024.

Long-term debt was $994.3 million as of Sept. 27, 2024, compared with $994 million as of June 28, 2024.

Cash generated by operating activities was $476 million in the quarter under discussion compared with $273.5 million in the prior quarter.

Free cash flow was $393.2 million, with a 38.4% free cash flow margin.

Skyworks paid dividends worth $112 million in the reported quarter.

SWKS Initiates 1Q25 Guidance

For the first quarter of fiscal 2025, the company expects revenues between $1.05 billion and $1.08 billion, up 4% sequentially at the mid-point.

Non-GAAP diluted shares are expected to be $1.57 per share.

SWKS Zacks Rank & Stocks to Consider

Skyworks currently carries a Zacks Rank #3 (Hold).

Adobe ADBE, BiliBili BILI and NVIDIA NVDA are some better-ranked stocks that investors can consider in the broader sector. Each stock presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Adobe shares have lost 11.7% year to date. ADBE is set to report its fourth-quarter 2024 results on Dec. 11.

Bilibili shares have gained 73.3% year to date. BILI is set to report its third-quarter 2024 results on Nov. 14.

NVIDIA shares have gained 199.5% year to date. NVDA is set to report its third-quarter fiscal 2025 results on Nov. 20.

Zacks Investment Research