NETGEAR, Inc. NTGR is strategically positioning itself to capitalize on the surging demand for robust networking solutions, fueled by the growing number of Internet-connected devices and the transition from older WiFi standards to the highly anticipated WiFi 7. The company is dedicated to maintaining its competitive edge through a series of product launches aligned with the new WiFi 7 standards.

Expanding the WiFi 7 Portfolio

NETGEAR recently made significant strides in expanding its Nighthawk WiFi 7 standalone router lineup. The introduction of the RS600, RS500 and RS200 routers complements the existing RS700S and RS300 models, collectively offering impressive speed, low latency and high capacity, all backed by robust security features. Moreover, in August 2024, NETGEAR unveiled the WBE710 Insight Manageable Tri-band WiFi 7 Access Point solution, designed to enhance data throughput across multiple bands and reduce network congestion.

Earlier in the year, the company launched two competitively priced WiFi 7 products — the Orbi 770 Tri-band Mesh System and the Nighthawk RS300 Router — positioning them as its most affordable offerings to date. These strategic moves aim to leverage the ongoing WiFi 7 upgrade cycle and attract a wider customer base.

NTGR Raises Q3 Guidance

NETGEAR's proactive approach has led to a positive adjustment in its financial outlook. The Connected Home (CHP) segment, featuring popular brands like Orbi, Nighthawk and Armor, is driving growth in premium products, with encouraging demand trends in the second quarter mainly due to new, lower-priced WiFi 7 offerings. As the new WiFi 7 upgrade cycle gains momentum, the CHP segment is expected to see headwinds diminish, further bolstering NETGEAR's prospects.

NETGEAR raised its revenue and margin guidance for the third quarter of 2024. This is attributed to a favorable litigation settlement with TP-Link and the early launch of its next-generation 5G mobile hotspot, which was initially scheduled for the fourth quarter. The revised revenue projections now range between $170 million and $180 million, up from the previous estimate of $160 million to $175 million. The company now expects the GAAP operating margin for the third quarter to be between 48% and 51% and the non-GAAP operating margin to be between (4)% and (1)%. Previously, the GAAP operating margin was forecasted to be between (15.3)% and (12.3)%, while the non-GAAP operating margin was estimated in the band of (11)-(8)%.

NETGEAR's strengthening WiFi 7 portfolio is likely to drive top-line growth as it capitalizes on increasing demand for robust networking solutions. The introduction of new products and competitive pricing positions the company well to attract a broader customer base and enhance its financial outlook.