Allot Ltd (NASDAQ:ALLT), the smart network intelligence solutions company, posted first-quarter results on Tuesday that showed its revenue jump 16% year-over-year boosted by its security offerings, which drew several new operators.
For the quarter ended March 31, 2020, the company posted unaudited revenue of $29.3 million, compared to $25.3 million in the same period a year earlier.
The company also reported a lower non-GAAP net loss of $0.4 million and a GAAP loss $1.7 million, or ($0.01) per share, compared to a non-GAAP net loss of $1.9 million and a GAAP loss of $3.3 million in the first quarter of 2019. That beat the consensus estimate for a loss of $0.09 per share.
Investors responded well, sending shares nearly 9.9% higher to $13.30 before the opening bell.
The firm said its non-GAAP gross margin increased to 74.8%, compared to 72.4% in the first quarter of 2019.
The company also had cash and investments at the end of the first quarter totaling $110.7 million.
In a statement accompanying the numbers, Allot CEO Erez Antebi said: "We are pleased with our first quarter results. We grew revenues by 16% year-over-year, while improving margins and continuing our advance toward profitability."
During the first quarter, some deals were delayed as a consequence of the coronavirus (COVID-19) pandemic and are now expected to close during the second quarter.
"COVID-19 is presenting Allot with both challenges and opportunities. Operators worldwide are seeing growth in demand for bandwidth of up to 40%, as well as an increase in cyberattacks on consumers and SMBs,” said Antebi.
“While some operators are delaying tasks they consider less critical, we see overall demand for Allot products and services at similar levels to what we saw before COVID-19, and in some areas, we even see somewhat increased demand," he added.
Allot did sign several new security deals during the first quarter, including two new recurring revenue deals with new operators — a small deal in the Asia Pacific region and a medium-sized deal in Latin America.
"Despite employees from both Allot and our customers working from home, as well as the other adaptations we have all made, we are continuing to work toward meeting our goals and are on track to achieving our original 2020 plan,” said Antebi.
“I believe that long-term, the growth in bandwidth needs and increased cyber security needs will further increase demand for Allot solutions."
Management reiterated its prior issued full-year 2020 guidance, with expectations for revenues to grow to between $135 million to $140 million, representing accelerated double-digit growth
Expectations are that second quarter revenue will exceed those reported for the first quarter of 2020, and management continues to expect to return to profitability on a quarterly basis before the year-end.
Management also expects to close additional recurring security revenue deals in 2020. The maximum annual revenue potential of concluded transactions for new deals to be signed in 2020 is expected to exceed $140 million.
The company’s multi-service platforms are used by over 500 mobile, fixed and cloud service providers and more than 1,000 enterprises. Allot NetworkSecure is the world’s largest deployed network-based security service for the mass market with over 20 million paying security customers.
Contact the author Uttara Choudhury at [email protected]
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