The Audinate Group Ltd (ASX: AD8) share price is surging this morning after reporting FY21 revenue growth.
Trading update sends Audinate share price higher
Audinate is the developer of the professional AV industry media networking solution called Dante. It replaces traditional analogue audio cables by transmitting synchronized audio signals across large distances, to multiple locations at once, using nothing more than an ethernet cable.
In FY21, Audinate said its revenue grew 23% to US$25 million.
The company said there was a strong finish to the year with the final quarter up 74% on the prior corresponding period. In Australian dollar terms, revenue grew just over 10% to A$33.4 million – that reflects the strengthening of the Australian dollar against the US dollar.
Uncertainty in the supply chain
Audinate explained that there are uncertainties in the global supply of chips and electronic components which continues to be a near-term risk for both Audinate and its original equipment manufacturer (OEM) customers.
The company continued to meet customer demand for chips and modules over the past few months despite COVID-19 impacts.
Increasing component lead times and requests by chip manufacturers for demand visibility up to 12 months out have resulted in a record backlog of committed sales orders for FY22 as OEMs have placed orders further into the future compared to their pre-COVID behaviour.
New video products
Audinate said that June marked the successful launch of the first Dante video products by Bolin Technology and Patton Electronics.
This represents an initial ecosystem of Dante AV products enabling a system integrator to fully fit out an AV installation using only Dante networking for video and audio distribution. It has been met with a positive initial response from customers.
Outlook
Audinate c-founder and CEO Aidan Williams said:
“The strong finish to the year, together with the record backlog of sales orders, means that Audinate is well placed to return to US$ revenue growth in the historical range and consistent with current market expectations in FY22.”
Summary thoughts on Audinate and the share price
Audinate is a very promising business. It’s good to see when ASX shares have a potentially global leading product.
The Audinate share price has now fully recovered. I’m not sure how big the market opportunity is with Dante, but it could be one of the ASX growth shares to keep an eye on.