NETGEAR Soars 13.6% on Earnings Beat

On May 1, 2025, NETGEAR's stock surged by 13.6% in pre-market trading, marking a significant rise that caught the attention of investors and analysts alike.

NETGEAR reported its first-quarter earnings, revealing a non-GAAP loss of 28 cents per share compared to the previous year. The company's net revenues for the quarter were $162.1 million, surpassing consensus estimates. This performance was driven by a strong non-GAAP gross margin of 35%, which saw a year-over-year increase of 550 basis points. However, the Home Networking Revenue declined by 8.7% year over year and 20.8% sequentially, indicating challenges in this segment.

Despite the decline in Home Networking Revenue, NETGEAR's overall performance was bolstered by better-than-expected revenue and operating margin. The company's revenue for the quarter was $162.1 million, a slight decrease from the previous year but still above estimates. Looking ahead, NETGEAR anticipates a second-quarter GAAP operating margin that reflects its strategic focus on cost management and operational efficiency.

Analysts had anticipated a loss of $0.37 per share, but NETGEAR's adjusted earnings of $0.02 per share significantly exceeded these expectations. This positive earnings surprise, coupled with the company's strategic outlook, has contributed to the bullish sentiment among investors. The company's guidance for the next quarter is also expected to provide further insights into its financial health and growth prospects.