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NeoPhotonics Corporation (NPTN) stock is soaring today: Why is it so?

Shares of the NeoPhotonics Corporation (NPTN) stock soared in the intraday session today on November 4, 2021. NPTN stock price saw a surge of 34.35% to reach $15.46 a share at the time of this writing. The stock became bullish after the announcement of the third quarter of 2021 financial results. Let’s dig in to explore more about this stock.

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Third Quarter 2021 Financial Results:

  • NeoPhotonics stock generated $83.7 million in revenue which represents a 29% increase in the quarter and an 18% decrease year-over-year.
  • NPTN stock reported a gross margin of 28.4% representing an increase of 15.2% in the same quarter of last year.
  • Non-GAAP gross margin increased by 21.7% from the previous quarter to reach 29.4% in the third quarter of 2021.
  • The operating income of the NPTN stock reached a loss of $1.3 million as compared to a $16.3 million loss in the previous quarter.
  • NPTN stock recorded a positive $1.3 million of non-GAAP operating income in the third quarter of 2021. This compares to the 10.3 million in the second quarter of 2021.
  • The stock suffered a net loss of $0.04 per share in the reported quarter as compared to $0.34 per share net loss in the previous quarter.
  • NPTN stock recorded $0.01 non-GAAP net earnings per share in the third quarter of 2021. This compares to $0.22 per share non-GAAP net loss in the previous quarter.
  • Adjusted EBITDA reached $6.7 million in the third quarter of 2021, higher than $5.4 million in the second quarter of 2021.
  • By the end of the third quarter of 2021, NPTN stock had $105 million in cash, cash equivalent, short-term investments, and restricted cash. The company had $3.6 million free cash flow and $0.1 million from operations. NeoPhotonics reduced $15 million debt from its China credit facility.

Developments of NPTN stock

NPTN stock shipped over two million tunable lasers cumulatively and announced a new frequency modulated continuous wave laser (FMCW). This laser is used in the LIDAR applications for autonomous vehicles.

NeoPhotonics stock signed the definitive agreement with Lumentum Holdings Inc. today. According to the agreement, Lumentum will acquire all the outstanding shares of the NPTN stock for $16 per share in an all-cash transaction. This represents an equity value of roughly $918 million.

Wrap up:

Investors are responding positively to the release of third-quarter 2021 financial results. The financial results reflect positive growth in revenue as well as gross margin as compared to the second quarter of 2021.

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