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Avaya Reports Fourth Quarter and Fiscal 2021 Financial Results
Q4 revenues of $760 million; FY21 revenue $2.973 billion - an increase of 3.5% year over year

Avaya Holdings Corp. (NYSE: AVYA) today reported financial results for the fourth quarter of fiscal 2021 ended September 30, 2021.

Avaya Holdings Corp. Shares have lost about 6.1% since the beginning of the year versus the S&P 500’s gain of 25.1%.

“Fiscal year 2021 for Avaya was a year marked by many firsts, and the outstanding results we delivered exceeded expectations on most every front. Most impressive is the fact that we reversed over a decade of annual revenue declines, delivering year over year growth closing up approximately $100 million, while we also grew ARR 177% to $530 million,” said Jim Chirico, President and CEO of Avaya.

Financial Highlights

Q4 Revenues of $760 million and fiscal 2021 revenues of $2.973 billion. Fiscal 2021 revenue includes an adjustment of approximately $15 million for the cumulative effect of an understatement of revenue in prior periods.

OneCloud ARR (Annualized Recurring Revenue) was $530 million, up 25% sequentially and 177% from a year ago.

CAPS (Cloud, Alliance Partner, and Subscription) was 44% of revenue, up from 33% a year ago; and 40% for fiscal 2021.

For fiscal 2021, software and services were 88% of revenue, flat year over year.

Recurring revenue was 66% for fiscal 2021, up from 63% a year ago.

GAAP Operating income was $33 million and Non-GAAP Operating income was $145 million; for fiscal 2021 GAAP Operating income was $180 million and Non-GAAP Operating income was $602 million.

GAAP Net income was $6 million and Non-GAAP Net income was $74 million; for fiscal 2021 GAAP Net. The loss was $13 million and Non-GAAP Net income was $304 million.

Adjusted EBITDA was $179 million, 23.6% of revenue, down 290 basis points year over year; for fiscal 2021 Adjusted EBITDA was $719 million, 24.2% of revenue.

GAAP Earnings Per Share of $0.06 and Non-GAAP Earnings Per Share of $0.77; for fiscal 2021 GAAP Loss Per Share was $0.20 and Non-GAAP Earnings Per Share was $3.16.

Ending cash and cash equivalents were $498 million.

What’s Next for Avaya Holdings Corp.

While Avaya Holdings Corp. Has underperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Financial Statement :

 

Avaya Holdings Corp.

Condensed Consolidated Statements of Operations (Unaudited)

(In millions, except per share amounts)

Three months ended September 30,

Fiscal years ended September 30,

2021

2020

2021

2020

REVENUE

Products

$

246

$

269

$

992

$

1,073

Services

514

486

1,981

1,800

760

755

2,973

2,873

COSTS

Products:

Costs

103

106

398

405

Amortization of technology intangible assets

44

44

173

174

Services

198

187

752

714

345

337

1,323

1,293

GROSS PROFIT

415

418

1,650

1,580

OPERATING EXPENSES

Selling, general and administrative

268

250

1,053

1,013

Research and development

61

52

228

207

Amortization of intangible assets

40

39

159

161

Impairment charges

624

Restructuring charges, net

13

3

30

30

382

344

1,470

2,035

OPERATING INCOME (LOSS)

33

74

180

(455

)

Interest expense

(53

)

(64

)

(222

)

(226

)

Other income, net

33

7

44

63

INCOME (LOSS) BEFORE INCOME TAXES

13

17

2

(618

)

(Provision for) benefit from income taxes

(7

)

20

(15

)

(62

)

NET INCOME (LOSS)

$

6

$

37

$

(13

)

$

(680

)

EARNINGS (LOSS) PER SHARE

Basic

$

0.06

$

0.40

$

(0.20

)

$

(7.45

)

Diluted

$

0.06

$

0.39

$

(0.20

)

$

(7.45

)

Weighted average shares outstanding

Basic

84.5

83.4

84.5

92.2

Diluted

86.9

84.3

84.5

92.2

 

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