ADTRAN Holdings, Inc. (NASDAQ:ADTN) reported Q3 preliminary results, with revenue at $272.3 million compared to the prior guidance range of $275 million-$305 million. 

Analysts’ consensus estimate for Q3 revenues stands at $288.18 million.

The strengthened U.S. dollar had a negative impact on revenue generated outside of the U.S.

The preliminary GAAP operating margin for Q3 was -30.2%, as customers remain focused on reducing inventory levels and managing capital expenses.

Q3 preliminary non-GAAP operating margin was -1.9%, at the upper end of the company’s guidance, helped by the planned reduction in operating expenses.

In the quarter under review, ADTRAN continued to add new customers in both Europe and the U.S.

However, management believes that customers will manage their inventories conservatively and adjust their capital expenditure budgets in Q4 in response to the changed economic environment.

“Moving forward through the end of this year, we will continue to focus on aligning our operating model to reflect the current environment,” said ADTRAN Holdings’ Chairman and Chief Executive Officer, Tom Stanton.

The final results for the three- and nine-month periods ended September 30, 2023, will be released as planned on November 6, 2023 (Central Time) or November 7, 2023 (Central European Time), respectively.

Price Action: ADTN shares closed higher by 5.62% at $7.71 on Monday.