Harmonic Inc (HLIT)

Harmonic Inc (HLIT) stock dropped by 14.61% following the strategic shifts announced by the company, including the decision not to pursue the sale of its video video business following a review. Additionally, President and CEO Patrick Harshman will retire in June and will be succeeded by Nimrod Ben-Natan, another long-time Harmonic executive.

• Video Business Review and Decision: Harmonic initiated a review of its video business last fall in response to inquiries from interested parties. Analysts estimated that the video business could have fetched bids in the range of $350 million to $500 million. Despite the video segment's revenue of $51.9 million in Q4 2023 (down 24.1% year-over-year), the software-as-a-service (SaaS) segment of the unit saw revenues increase by 26%, reaching $13.2 million. The review, which involved the board and outside financial legal advisors, concluded that the current market conditions do not support the value creation objectives for the Video business. As a result, Harmonic has decided not to pursue a sale of the video unit at this time.
• Leadership Transition: Patrick Harshman, who has been President and CEO of Harmonic, will step down and retire in June. He will be succeeded by Nimrod Ben-Natan, who has been with Harmonic since 1996 and has served in various roles, including Senior Vice President and General Manager of the Broadband business.

Harmonic Inc. (HLIT) stock fell 22% to $11.63 after the company posted downbeat second-quarter results and lowered FY23 outlook. Several analysts reduced the price target post-Q2 2023 earnings miss.

https://www.benzinga.com/analyst-ratings/analyst-color/23/08/33500509/why-harmonic-shares-are-diving-today