Control4 (Nasdaq: CTRL), a leading provider of home automation, multiroom A/V, lighting controls and energy management systems, reported record revenues of $55.2 million for fiscal Q3 ended Sept. 30, 2016 – up 27% from Q3 2015. The revenue was $700,000 above the high end of the company’s guidance range.
Pakedge, the networking company that Control4 acquired earlier this year, helped the numbers, delivering $7.1 million in revenue for the quarter. Some 1,250 Control4 dealers have purchased Pakedge products for the first time since the late-January acquisition.
Capturing Control4’s existing dealer base was a key motivation for acquiring Pakedge. Year-over-year, Pakedge sales are up 23% for the first 9 months of 2016.
But the gain is not solely from Pakedge. Control4 sold more than 24,350 EA Series controller in the third quarter – 8% more than the 22,500 units sold in Q2.
Last year, the introduction of the EA series broadened Control4’s market with price points ranging from $500 to $2,000 compared to $750 to $1,500 in the previous series.
New Products, Technologies at CEDIA
In September, the company had a strong showing at CEDIA Expo 2016, the big event for the home-technology integration channel. There, the company introduced new products and services to a packed ballroom of more than 1000 dealers, with another 1000 tuning in live from around the globe via an online broadcast.
At CEDIA, Control4 announced – and launched – a voice-control driver for Amazon Alexa. Without days of the release, Control4 had “well over a thousand end customers using their Amazon Echo device with their Control4 system,” said Control4 CEO Martin Plaehn during the company’s Q3 2016 earnings call.
The company also introduced OS version 2.9, which included tighter integration with third-party motorized shades and Z-Wave devices.
Since releasing Control4 OS 2.9 to dealers on Sept. 15, some 30,000 homes had upgraded to the new software by the end of October. “A couple thousand of these are using Alexa Voice interaction daily within their Control4-connected homes,” Plaehn says.
Control4 also made some big announcements around Pakedge, most notably that the remote-monitoring service, Bakpak 4.0, would now be free to dealers and would be able to “see” and fix Z-Wave devices through the cloud-based platform, much as it already does for ZigBee.
Control4’s strong revenue in Q3, combined with non-GAAP gross margins of 52.5%, contributed to net income of $6.4 million for the quarter, or $0.26 per diluted share, which again exceeded high-end of Control4’s guidance range.
Control4 shares dipped below $10 on Nov. 3 before the earnings report was released that evening, but the stock rebounded the following day to $11.35.