Symbotic Inc. (SYM) is scheduled to release second-quarter fiscal 2025 results on May 7, after market close.The company surpassed the Zacks Consensus Estimate in three of the four trailing quarters and missed once, delivering an average earnings surprise of 181.3%.Symbotic Inc. Price and EPS Surprise Symbiotic’s Q2 ExpectationsThe Zacks Consensus Estimate for SYM’s revenues is pegged at $517.9 million, indicating a 22.1% rise from the year-ago quarter’s actual. Solid progress across systems in the deploymen ...

Group 1 - Symbotic (NASDAQ: SYM) has demonstrated significant growth over the past five years, yet its stock has declined by 43% in the last year [1] - The company specializes in AI-powered warehouse management and reached an all-time high stock price of $63.64 [1] Group 2 - The article reflects a perspective of value dividend investing, focusing on identifying heavily undervalued companies with substantial upside potential [1] - The author emphasizes a long-term investment strategy aimed at generating income through dividends [1]

The latest trading session saw Symbotic Inc. (SYM) ending at $20.41, denoting a +0.79% adjustment from its last day's close. This move outpaced the S&P 500's daily gain of 0.13%. Elsewhere, the Dow saw a downswing of 1.33%, while the tech-heavy Nasdaq depreciated by 0.13%.The company's shares have seen a decrease of 5.81% over the last month, not keeping up with the Business Services sector's loss of 0.93% and outstripping the S&P 500's loss of 6.3%.The investment community will be paying close attention to ...

Core Insights - Symbotic Inc. will release its second quarter fiscal 2025 financial results on May 7, 2025, after market close [1] - A live webcast to discuss the financial results will be held at 5:00 p.m. ET on the same date [1][2] Company Overview - Symbotic is a leader in automation technology, focusing on A.I.-powered robotics and software for supply chain management [3] - The company aims to transform warehouses into strategic assets for major retail, wholesale, and food & beverage companies [3] - By utilizing next-generation technology, high-density storage, and machine learning, Symbotic addresses complex distribution challenges, enhancing speed, agility, accuracy, and efficiency in goods movement [3]

Core Viewpoint - Opportunistic investors are seizing the chance to buy Symbotic stock after its significant decline, particularly following its 52-week low of $16.32 per share on April 4, with a subsequent bounce back of 16.1% [1] Group 1: Company Overview - Symbotic specializes in developing fully autonomous mobile robots powered by AI software for automating warehouses, distribution centers, and supply chains [2] - The company has a long-standing relationship with Walmart, dating back to 2015, and recently acquired Walmart's advanced systems and robotics business [5] Group 2: Financial Performance - Symbotic's revenue grew by 47% year over year in Q4, but only 35% growth was reported for the first quarter of fiscal 2025, ending December 31, 2024 [4] - The company reported a steady net loss of $19 million and projected around 30% revenue growth for Q2 [4] Group 3: Strategic Partnerships and Market Potential - Walmart paid $230 million at the deal's closing and will pay an additional $290 million, with Symbotic estimating that this deal could add $5 billion to its backlog in the long term [3] - The addressable market size for Symbotic's services in the U.S. is over $300 billion [3] Group 4: Market Conditions and Challenges - Despite the recent stock decline of 55% over the past year, investors view the current price as a buying opportunity [4] - Ongoing tariffs and trade wars may disrupt supply chains and increase costs, posing potential challenges for Symbotic [5]

Core Insights - Associated Food Stores (AFS) has successfully activated a warehouse modernization initiative in partnership with Symbotic Inc., enhancing its distribution center in Utah to better serve nearly 500 independent grocers in the Intermountain West [1][5]. Group 1: Warehouse Modernization Initiative - The initiative involves the implementation of Symbotic's end-to-end automation system, which includes robotic case pick capabilities, aimed at improving supply chain efficiency and retail experiences [2][4]. - The automation system will enhance product delivery accuracy, increase speed to shelf, and improve SKU availability, thereby optimizing inventory utilization for AFS [2][5]. Group 2: Company Commitment and Future Plans - AFS emphasizes its 85-year commitment to efficiency and service, positioning itself at the forefront of supply chain innovation through this partnership with Symbotic [1][5]. - The initiative is expected to create growth opportunities for distribution center team members, ensuring job security and continued support for independent grocers in the region [5]. Group 3: Event and Stakeholder Engagement - AFS will host a special event to celebrate the activation of the new system, inviting media representatives and industry partners to witness the advanced automation technologies in action [3]. Group 4: Company Background - Established in 1940, AFS has grown to serve nearly 500 independent retailers, focusing on empowering them to compete against larger chain stores [6]. - Symbotic is recognized as a leader in automation technology, providing AI-powered solutions to transform supply chain operations for major retail and wholesale companies [7].

Core Viewpoint - Symbiotic Inc. (SYM) shares have decreased by 41.9% over the past year, underperforming its industry and the broader market, raising questions about the timing for potential investment in the company [1][4]. Group 1: Stock Performance - SYM's stock is currently trading below its 50-day moving average, indicating bearish sentiment among investors [4]. - In contrast, industry peers Aurora Innovation, Inc. (AUR) and Allot Ltd. (ALLT) have seen significant gains of 175.6% and 172.9% respectively over the same period [4]. Group 2: Strategic Acquisitions and Expansion - Symbiotic completed the acquisition of Walmart's advanced systems and robotic business in January 2025, which is expected to enhance its backlog by over $5 billion and expand its total addressable market [5][6]. - The company also acquired OhmniLabs in December 2024, aiming to integrate its automation expertise with OhmniLabs' mobile robots and AI solutions for healthcare applications [7]. - Additionally, SYM has entered a commercial agreement with Walmex to deploy its warehouse automation systems in Mexico, further contributing to revenue growth [8]. Group 3: Financial Outlook - The Zacks Consensus Estimate for SYM's fiscal 2025 revenues is projected at $2.3 billion, reflecting a year-over-year growth of 21.9% [9]. - The consensus estimate for SYM's fiscal 2025 earnings is 25 cents per share, indicating a more than 100% year-over-year increase [9]. Group 4: Liquidity and Cost Considerations - SYM's current ratio of 1.22 is below the industry average of 2.21, although it still suggests the company can meet its short-term obligations [10]. - Steel prices significantly impact SYM's cost of goods sold, with management implementing pass-through clauses to recover costs from customers [12]. - Rising steel prices due to tariffs could increase project costs for retailers, potentially affecting SYM's return on investment [13]. Group 5: Valuation and Investment Considerations - SYM's stock is currently considered expensive, trading at 67.5 times forward 12-month earnings per share, which is higher than the industry average of 39.8 times [14]. - Despite the recent stock decline, the company's long-term prospects appear solid due to its acquisitions and strategic expansions, though a cautious investment approach is recommended [16].

Company Analysis - Symbotic's Q1 results and forward guidance were disappointing, leading to a sharp drop in share price due to a lack of growth in system deployments, which is expected to result in continued softening of growth in upcoming quarters [1] Industry Insights - Narweena, an asset manager, focuses on identifying market dislocations caused by poor understanding of long-term business prospects, aiming for excess risk-adjusted returns through secular growth opportunities in markets with barriers to entry [1] - The research process emphasizes company and industry fundamentals to uncover unique insights, with a high risk appetite and long-term investment horizon targeting deeply undervalued stocks, particularly in smaller cap stocks and less obvious competitive advantage markets [1] - An aging population with low growth and stagnating productivity is expected to create a different set of investment opportunities, with many industries facing stagnation or secular decline, potentially improving business performance as competition decreases [1] - The economy is increasingly dominated by asset-light businesses, leading to a declining need for infrastructure investments, resulting in a large pool of capital chasing limited investment opportunities, driving up asset prices and compressing risk premia over time [1]

Financial Data and Key Metrics Changes - First quarter revenue grew 35% year-over-year to $487 million, driven by solid progress across 44 systems in deployment and over 80% year-over-year growth from recurring revenue [12][16] - Adjusted EBITDA for the quarter was $18 million, exceeding forecasts, while the net loss was $19 million [16][17] - Cash and equivalents increased to $903 million from $727 million in the previous quarter, primarily due to cash from operations of $205 million [16] Business Line Data and Key Metrics Changes - Software revenue more than doubled year-over-year, achieving software margins over 65% for the first time [12][14] - Operations Services posted a negative gross profit as the company invested in additional resources to support customer success [14][15] - The backlog of committed contracted orders remained consistent at $22.4 billion, with the addition of the Walmex contract offset by revenue recognized during the quarter [13] Market Data and Key Metrics Changes - The company is seeing increased inquiries from manufacturers and suppliers, indicating a shift in customer spending behavior towards automation solutions [45][46] - Walmart's commitment to deploying technology in 400 stores represents over $5 billion of future backlog, contingent on meeting performance criteria [10] Company Strategy and Development Direction - The company aims to scale for growth and invest in innovation while delivering high-quality systems to customers [5][6] - Recent acquisitions, including Walmart's Advanced Systems and Robotics business, are seen as transformative, enhancing the company's technology position in supply chain automation [9][10] - The focus on reliability and ease of use is expected to yield long-term benefits that outweigh short-term expenses [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the operating environment, noting increased customer inquiries and a willingness to invest in automation [46] - The outlook for the second quarter includes expected revenue of $510 million to $530 million and adjusted EBITDA between $26 million and $30 million, reflecting continued growth [17] Other Important Information - The company has made significant investments in technology, including the hiring of a new CTO and the acquisition of Omni Labs to enhance simulation capabilities [7][8] - The integration of recent acquisitions is underway, with expectations for a smooth transition due to proximity and existing relationships [62] Q&A Session Summary Question: OpEx expectations for 2Q - Management expects OpEx to increase by $5 million to $10 million in the second quarter, driven by long-term investments and acquisitions [22][23] Question: Operations Services loss - The loss in Operations Services is attributed to supporting customer resource needs as large systems go live, with expectations for moderation in the near term [26][27] Question: In-sourcing progress - The transition to in-sourcing is on track, with all engineering, procurement, and construction work now managed in-house [35][36] Question: Customer budget discussions - There is an increase in inquiries from potential customers, indicating a willingness to invest in automation solutions [45][46] Question: Tariff impacts - The company has minimal exposure to China, with contracts typically allowing for pass-throughs of tariff costs [48][52] Question: Control procedures post-audit - Remediation controls have been implemented, and testing results are encouraging, with no deficiencies noted [56][57] Question: Software subscriptions decline - The decline in software subscriptions was due to a one-time benefit in the previous quarter; overall software revenue is expected to continue growing [107][108] Question: GreenBox demand - Demand for GreenBox technology is increasing, with expectations for revenue ramp-up in the latter half of the year [95][96] Question: Walmart Robotics acquisition - The integration of Walmart's robotics technology is expected to accelerate rollout and enhance capabilities [160] Question: International market activity - Increased interest and inquiries from international markets, particularly in Mexico, indicate potential growth opportunities [163]

Core Insights - Symbotic Inc. reported revenue of $486.69 million for the quarter ended December 2024, reflecting a year-over-year increase of 32.1% [1] - The earnings per share (EPS) was -$0.03, slightly worse than the previous year's EPS of -$0.02 [1] - The revenue fell short of the Zacks Consensus Estimate by 0.60%, while the EPS exceeded the consensus estimate by 25.00% [1] Revenue Breakdown - Software maintenance and support revenue was $5.53 million, surpassing the two-analyst average estimate of $5.25 million [4] - Systems revenue reached $464.06 million, slightly above the two-analyst average estimate of $461.94 million [4] - Operation services revenue was $17.11 million, below the two-analyst average estimate of $19.97 million [4] Stock Performance - Shares of Symbotic Inc. have returned +18.4% over the past month, outperforming the Zacks S&P 500 composite's +1.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]