Ubiquiti Inc. Reports Third Quarter Fiscal 2025 Financial Results
Ubiquiti Inc. (NYSE: UI) ("Ubiquiti" or the "Company") today announced its financial results for the third quarter ended March 31, 2025. Third Quarter Fiscal 2025 Financial Summary Revenues of $664...
~ Record Revenues of $664.2 million ~
~ Record GAAP Diluted Earnings Per Share of $2.98 ~
NEW YORK: Ubiquiti Inc. (NYSE: UI) ("Ubiquiti" or the "Company") today announced its financial results for the third quarter ended March 31, 2025.
Third Quarter Fiscal 2025 Financial Summary
- Revenues of $664.2 million
- GAAP diluted EPS of $2.98
- Non-GAAP diluted EPS of $3.00
Additional Financial Highlight
- The Company's Board of Directors declared a $0.60 per share cash dividend payable on May 27, 2025 to shareholders of record at the close of business on May 19, 2025.
Financial Highlights ($, in millions, except per share data)
Income statement highlights |
| F3Q25 |
| F2Q25 |
| F3Q24 |
Revenues |
| 664.2 |
| 599.9 |
| 493.0 |
Enterprise Technology |
| 585.7 |
| 518.2 |
| 414.3 |
Service Provider Technology |
| 78.4 |
| 81.7 |
| 78.7 |
Gross profit |
| 295.9 |
| 247.2 |
| 174.1 |
Gross Profit (%) |
| 44.5% |
| 41.2% |
| 35.3% |
Total Operating Expenses |
| 69.0 |
| 68.4 |
| 62.9 |
Income from Operations |
| 226.9 |
| 178.8 |
| 111.2 |
GAAP Net Income |
| 180.4 |
| 136.8 |
| 76.3 |
GAAP EPS (diluted) |
| 2.98 |
| 2.26 |
| 1.26 |
Non-GAAP Net Income |
| 181.8 |
| 138.1 |
| 77.6 |
Non-GAAP EPS (diluted) |
| 3.00 |
| 2.28 |
| 1.28 |
Ubiquiti Inc. Revenues by Product Type (In thousands) (Unaudited) |
|
|
|
| ||||||||
|
| Three Months Ended March 31, |
| Nine Months Ended March 31, | ||||||||
|
|
| 2025 |
|
| 2024 |
|
| 2025 |
|
| 2024 |
Enterprise Technology |
| $ | 585,723 |
| $ | 414,345 |
| $ | 1,574,108 |
| $ | 1,185,932 |
Service Provider Technology |
|
| 78,447 |
|
| 78,652 |
|
| 240,285 |
|
| 235,097 |
Total revenues |
| $ | 664,170 |
| $ | 492,997 |
| $ | 1,814,393 |
| $ | 1,421,029 |
Ubiquiti Inc. Revenues by Geographical Area (In thousands) (Unaudited) |
|
|
|
| ||||||||
|
| Three Months Ended March 31, |
| Nine Months Ended March 31, | ||||||||
|
|
| 2025 |
|
| 2024 |
|
| 2025 |
|
| 2024 |
North America |
| $ | 322,726 |
| $ | 242,511 |
| $ | 915,615 |
| $ | 693,154 |
Europe, the Middle East and Africa |
|
| 282,121 |
|
| 200,666 |
|
| 695,589 |
|
| 546,010 |
Asia Pacific |
|
| 37,480 |
|
| 26,459 |
|
| 121,499 |
|
| 95,815 |
South America |
|
| 21,843 |
|
| 23,361 |
|
| 81,690 |
|
| 86,050 |
Total revenues |
| $ | 664,170 |
| $ | 492,997 |
| $ | 1,814,393 |
| $ | 1,421,029 |
Income Statement Items
Revenues
Revenues for the third quarter of fiscal 2025 were $664.2 million, representing an increase from the prior quarter of 10.7% and an increase from the comparable prior year period of 34.7%.
The increase in revenues compared to the prior quarter as well as the comparable prior year period was driven by an increase in revenue from our Enterprise Technology platform, partially offset by a decrease in revenue from our Service Provider Technology platform.
Gross Margins
During the third quarter of fiscal 2025, GAAP gross profit was $295.9 million. GAAP gross margin of 44.5% increased by 3.3% as compared to the prior quarter GAAP gross margin of 41.2% and increased by 9.2% as compared to the comparable prior year period GAAP gross margin of 35.3%.
The increase in gross profit margin as compared to the prior quarter was primarily driven by favorable product mix and lower indirect operating expenses. The increase in gross profit margin as compared to the comparable prior year period was primarily driven by lower excess and obsolete inventory charges, favorable product mix, and lower tariffs, offset in part by higher shipping costs.
Research and Development
During the third quarter of fiscal 2025, research and development ("R&D") expenses were $44.3 million. This reflects an increase as compared to the R&D expenses of $40.0 million in the prior quarter and an increase as compared to the R&D expenses of $42.5 million in the comparable prior year period.
The increase in R&D expenses as compared to the prior quarter was primarily driven by higher employee-related expenses, prototype-related expenses, and software expenses. The increase in R&D expenses as compared to the comparable prior year period was primarily driven by higher employee-related expenses and software expenses, offset in part by lower prototype-related expenses.
Sales, General and Administrative
The Company’s sales, general and administrative ("SG&A") expenses for the third quarter of fiscal 2025 were $24.8 million. This reflects a decrease as compared to the SG&A expenses of $28.5 million in the prior quarter and an increase compared to the SG&A expenses of $20.4 million in the comparable prior year period.
The decrease in SG&A costs as compared to the prior quarter was primarily due to lower bad debt expenses relating to a customer default, offset in part by higher marketing expenses and an increase in webstore sales and their corresponding credit card processing fees. The increase in SG&A as compared to the comparable prior year period was primarily due to an increase in webstore sales and their corresponding credit card processing fees, marketing expenses, and employee-related expenses.
Interest Expense and Other, net
During the third quarter of fiscal 2025, interest expense and other, net ("I&O") expenses were $5.4 million. This reflects a decrease as compared to the I&O expenses in the prior quarter of $11.4 million and a decrease as compared to the I&O expenses in the comparable prior year period of $18.9 million, respectively.
The decrease in I&O expenses as compared to the prior quarter was primarily due to foreign exchange gains in the third quarter of fiscal 2025 compared to foreign exchange losses in the prior quarter and lower interest expense driven by a decrease in borrowings. The decrease in I&O expenses, as compared to the comparable prior year period, was primarily due to lower interest expense driven by a decrease in borrowings and lower interest rates and foreign exchange gains in the third quarter of fiscal 2025 compared to foreign exchange losses in the comparable prior year period.
Net Income and Earnings Per Share
During the third quarter of fiscal 2025, GAAP net income was $180.4 million and non-GAAP net income was $181.8 million. This reflects an increase in GAAP net income and non-GAAP net income from the comparable prior year period by 136.5% and 134.5%, respectively, primarily driven by higher revenues and gross profit. Third quarter fiscal 2025 GAAP earnings per diluted share was $2.98 and non-GAAP earnings per diluted share was $3.00. This reflects an increase in GAAP and non-GAAP earnings per diluted share from the comparable prior year period of 136.5% and 134.4%, respectively.
About Ubiquiti Inc.
Ubiquiti Inc. is focused on democratizing network technology on a global scale — creating networking infrastructure in over 200 countries and territories around the world. Our professional networking products are powered by our UISP and UniFi software platforms to provide high-capacity distributed Internet access and unified information technology management, respectively.
Ubiquiti and the U logo are trademarks or registered trademarks of Ubiquiti and/or its affiliates in the United States and other countries. For more information, please visit www.ui.com.
Safe Harbor for Forward Looking Statements
Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements other than statements of historical fact including words such as "look", "will", "anticipate", "believe", "estimate", "expect", "forecast", "consider" and "plan" and statements in the future tense are forward looking statements. The statements in this press release that could be deemed forward-looking statements include the statement regarding our intention to pay quarterly cash dividends, any statements or assumptions underlying the foregoing, and any statement regarding future events and the future financial performance of Ubiquiti Inc. that involves risks or uncertainties.
Forward-looking statements are subject to certain risks and uncertainties that could cause our actual future results to differ materially or cause a material adverse impact on our results. Potential risks and uncertainties include, but are not limited to, the impact of U.S. tariffs on our operations and financial results; the impact of public health problems, such as COVID-19 on results; fluctuations in our operating results; varying demand for our products due to the financial and operating condition of our distributors and their customers, and our distributors’ inventory management practices; political and economic conditions and volatility affecting the stability of business environments, economic growth, currency values, commodity prices and other factors that may influence the ultimate demand for our products in particular geographies or globally; impact of counterfeiting and our ability to contain such impact; our reliance on a limited number of distributors; inability of our contract manufacturers and suppliers to meet our demand; our dependence on chipset suppliers for chipsets without a short-term alternative; as we move into new markets competition from certain of our current or potential competitors who may be more established in such markets; our ability to keep pace with technological and market developments; success and timing of new product introductions by us and the performance of our products generally; our ability to effectively manage the significant increase in our transactional sales volumes; we may become subject to warranty claims, product liability and product recalls; that a substantial majority of our sales are into countries outside the United States and we are subject to numerous U.S. export control and economic sanctions laws; costs related to responding to government inquiries related to regulatory compliance; our reliance on certain key members of our management team, including our founder and chief executive officer, Robert J. Pera; adverse tax-related matters such as tax audits, changes in our effective tax rate or new tax legislative proposals; whether the final determination of our income tax liability may be materially different from our income tax provisions; the impact of any intellectual property litigation and claims for indemnification; litigation related to U.S. securities laws; and social, economic and political conditions in the United States and abroad, including the impact of the military conflict between Russia and Ukraine and the tension between China and Taiwan. We discuss these risks in greater detail under the heading "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the year ended June 30, 2024, and subsequent filings filed with the U.S. Securities and Exchange Commission (the "SEC"), which are available at the SEC’s website at www.sec.gov. Copies may also be obtained by contacting the Ubiquiti Inc. Investor Relations Department, by email at IR@ui.com or by visiting the Investor Relations section of the Ubiquiti Inc. website, https://ir.ui.com/.
Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date made. Except as required by law, Ubiquiti Inc. undertakes no obligation to update information contained herein. You should review our SEC filings carefully and with the understanding that our actual future results may be materially different from what we expect.
Ubiquiti Inc. Condensed Consolidated Statements of Operations and Comprehensive Income (In thousands, except per share data) (Unaudited) |
|
|
|
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|
| Three Months Ended March 31, |
| Nine Months Ended March 31, | ||||||||
|
|
| 2025 |
|
| 2024 |
|
| 2025 |
|
| 2024 |
Revenues |
| $ | 664,170 |
| $ | 492,997 |
| $ | 1,814,393 |
| $ | 1,421,029 |
Cost of revenues |
|
| 368,296 |
|
| 318,897 |
|
| 1,039,672 |
|
| 885,407 |
Gross profit |
|
| 295,874 |
|
| 174,100 |
|
| 774,721 |
|
| 535,622 |
Operating expenses: |
|
|
|
|
|
|
|
| ||||
Research and development |
|
| 44,262 |
|
| 42,498 |
|
| 122,217 |
|
| 115,692 |
Sales, general and administrative |
|
| 24,751 |
|
| 20,379 |
|
| 77,626 |
|
| 59,302 |
Total operating expenses |
|
| 69,013 |
|
| 62,877 |
|
| 199,843 |
|
| 174,994 |
Income from operations |
|
| 226,861 |
|
| 111,223 |
|
| 574,878 |
|
| 360,628 |
Interest expense and other, net |
|
| 5,420 |
|
| 18,870 |
|
| 27,437 |
|
| 58,356 |
Income before income taxes |
|
| 221,441 |
|
| 92,353 |
|
| 547,441 |
|
| 302,272 |
Provision for income taxes |
|
| 41,006 |
|
| 16,063 |
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