DALLAS - DZS Inc. (OTC: DZSI), a company specializing in network edge, connectivity, and cloud edge software solutions, has finalized the sale of its service assurance and WiFi management software portfolio to AXON Networks. The transaction, which includes the Expresse, CloudCheck, and TruSpeed products along with their intellectual property patents, was completed today.
Charlie Vogt, President and CEO of DZS, stated that this deal marks a positive development for all parties involved, including customers. By divesting these assets, DZS aims to sharpen its focus on its core offerings in broadband networking, connectivity, and cloud edge software.
DZS, known for enabling broadband access globally, will continue to evolve its development and market approach, concentrating on its primary business areas. The sale to AXON Networks allows DZS to streamline its operations and direct resources toward these strategic priorities.
The financial terms of the sale have not been disclosed. This move comes amid a dynamic market environment where companies are increasingly looking to optimize their portfolios and concentrate on key growth areas.
The press release from DZS includes forward-looking statements that are subject to risks and uncertainties, including those related to market conditions and the ongoing impacts of the COVID-19 pandemic. These statements are based on current expectations and could significantly differ from actual future events or results.
This news is based on a press release statement from DZS, and it reflects the company's strategic decision to sell certain assets as it refines its focus on its core business. The sale to AXON Networks is now complete, and DZS will continue to operate in its primary market segments.
In other recent news, China-based drone manufacturer DJI has challenged the U.S. Defense Department's decision to list it as a company associated with the Chinese military. DJI has taken legal steps to dispute this designation, claiming it has caused significant financial damages. The exact nature and extent of these damages have not been disclosed.
On another front, DZS Inc., a manufacturer of telecommunication equipment, has received a notification of delisting from Nasdaq due to non-compliance with periodic filing requirements. This change in trading platform is accompanied by an executive shift within the company. Chief Financial Officer Misty Kawecki is set to leave her position by the end of September, with former Chief Accounting Officer Brian Chesnut stepping in as interim CFO.
Furthermore, DZS Inc. has reported its financial results and strategic initiatives during a recent earnings call. Despite a 21% year-over-year decline in revenue for the first half of 2024, the company has seen an improvement in profitability and a growth in backlog orders. As part of its recovery plan, DZS is focusing on improving its balance sheet, reducing operating expenses, and leveraging acquisitions to drive future growth, with an aim to be relisted on Nasdaq. These are some of the recent developments shaping the future of DJI and DZS Inc.
InvestingPro Insights
As DZS Inc. (OTC: DZSI) completes the sale of its service assurance and WiFi management software portfolio, InvestingPro data provides additional context to the company's financial situation and market performance.
DZS's market capitalization stands at $26.63 million, reflecting its current position as a small-cap company. This relatively modest valuation aligns with the company's strategic move to streamline its operations and focus on core offerings.
An InvestingPro Tip indicates that DZS is "trading at a low Price / Book multiple," with a Price / Book ratio of 0.53 as of the last twelve months ending Q2 2024. This suggests that the stock might be undervalued relative to its book value, which could be of interest to value investors considering the company's renewed focus on its primary business areas.
Another relevant InvestingPro Tip notes that DZS has experienced a "strong return over the last month," with data showing a 43.64% price total return over the past month. This recent positive momentum might reflect market optimism about the company's strategic decisions, including the asset sale to AXON Networks.
However, it's important to note that DZS faces some financial challenges. The company's revenue for the last twelve months ending Q2 2024 was $228.28 million, with a revenue growth of -17.76% over the same period. This decline in revenue underscores the importance of the company's efforts to refocus on its core business and potentially improve its financial performance.
For investors seeking a more comprehensive analysis, InvestingPro offers 14 additional tips for DZS, providing a deeper understanding of the company's financial health and market position.
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