Stamford, Conn. — Harman International reported a 32 percent gain in net sales, with net income more than doubling year on year in its fiscal third quarter, ended March 31.
Net sales for the third quarter were $1.404 billion, an increase of 32 percent compared with the same period last year.
All three Harman divisions reported increased sales. Infotainment net sales were up due to higher automotive production and take rates. Lifestyle growth was driven by one large order from a mobile telecommunications customer and accelerated sales of new products launched earlier in the year in the home and multimedia business, and an increase in automotive production in the car audio business. Professional net sales increased as a result of the expansion of the Harman’s product portfolio into lighting.
Net income was $73 million for the quarter, up a whopping 110 percent over last year’s third quarter of $35 million.
Operating income on a GAAP basis was $101 million, compared with $38 million in the same period last year.
Dinesh C. Paliwal, Harman’s chairman, president and CEO, said, “In our automotive businesses, we are capitalizing on robust demand for an embedded connected car experience and a more favorable production environment. There is pent-up demand, particularly in Europe, which we expect will stabilize in the coming quarters."
For the infotainment division, net sales in the third quarter were $736 million, an increase of 29 percent compared to the prior year, or 26 percent excluding the impact of foreign currency translation. The sales increase was due to higher automotive production, the expansion of the company's recent production launches across car lines, and higher take rates.
Operating income rose dramatically, 184 percent to $60 million from the prior year’s $21 million.
In the lifestyle division, net sales in the third quarter of fiscal 2014 were $468 million, an increase of 43 percent compared with same period in the prior year. The growth in the home and multimedia business was primarily due to one large order from a mobile telecommunications customer and accelerated sales of new products launched earlier in the year.
The growth in the car audio business was primarily driven by an increase in automotive production and higher take rates, Harman said.
On a GAAP basis, third-quarter operating income took a big leap, from $23 million last year to $51 million now.
Harman continued to roll-out its proprietary Clari-Fi technology. It is an integral part of the new HTC One M8 Harman Kardon edition smartphone launched by Sprint in North America earlier this week.
For the professional division, net sales in the third quarter were $200 million, an increase of 21 percent. The increase in net sales is primarily due to the expansion of the company's product portfolio into lighting as a result of the acquisition of Martin Professional.
Operating income grew 16 percent in the quarter year on year to $26 million.