Harmonic puts video sale on ice, CEO Harshman to depart

Source: Alamy.com

Cable and video technology outfit Harmonic has abandoned plans to sell its video unit in light of the current state of the market. Separately, CEO Patrick Harshman is to step down on June 11 and will be replaced by broadband business chief Nimrod Ben-Natan.

The decision not to go ahead with a sale of the video business comes after a review initiated in November last year.

Harmonic started considering a sale of its video business after posting a sharp drop in revenue and a loss of US$6.5 million in the third quarter. The technology company said it had received expressions of interest in the business from several parties.

At the time the company said it had launched a strategic review of the video business after looking at the growth potential of its broadband and video software-as-a-service lines.

However, it has now put any sale on ice in view of current conditions.

“After carefully evaluating a range of alternatives, the Board concluded its review and determined that current market conditions do not support its value creation objectives for the Video business,” the company said.

“The go-forward strategy for Harmonic’s Video business will be centered on driving profitable growth by focusing on scalable market opportunities, streamlining operations and optimizing its cost structure.”

Nimrod Ben-Natan to be CEO

Harshman meanwhile will retire as President and CEO, to be replaced by the SVP and general manager of Harmonic’s broadband business, Ben-Natan.

Harshman will work with the board and Ben-Natan to ensure a smooth transition.

Ben-Natan joined Harmonic in 1996 as a software engineer to design and develop its first-generation video transmission platform. He has led the broadband business since 2012, and is credited as a key driving force in the advancement of next-generation broadband networks, along with the development and deployment of the company’s cOS virtualized broadband technology.

“On behalf of the entire Board, I’d like to thank Patrick for his leadership and service to Harmonic, guiding the Company through multiple strategic transformations over the years. It has been a real pleasure to work with him all these years and we wish him success, good health and happiness in the next chapter of his life. We are pleased that his expertise will be available to support Nimrod and the Board in this transition,” said Patrick Gallagher, chair of the Harmonic board of directors.

“As part of a thoughtful succession planning process, we conducted a comprehensive evaluation of both internal and external candidates with the support of a leading search firm. Nimrod was the standout – his leadership has been pivotal in the rapid growth of the Company’s groundbreaking and market-leading virtualized broadband access solutions. He is admired and respected by our employees and customers, and the Board is confident that his strategic vision, experience and business acumen will drive Harmonic’s future success.”

Harshman said: “Leading Harmonic has been the privilege of a lifetime and I am proud of what we have accomplished. Together, we strategically re-positioned the Company as a worldwide leader in next-generation broadband solutions and video streaming and delivery solutions, successfully expanding our customer base, international presence and product portfolio. Nimrod is ideally suited to lead Harmonic and our talented global team into its next chapter of innovation and growth.”

Ben-Natan said: “I am energized and excited to step into the CEO position. I look forward to collaborating with the Board and our Harmonic team to build on the strong foundation we have established as we continue to revolutionize broadband networks and cloud streaming.”

Harmonic management now expects total company first quarter 2024 revenue to be in the range of US$121 million to US$123 million, with revenue between US$78.5 million to US$79.5 million for the broadband segment and between US$42.5 million to US$43.5 million for the video segment.

Harmonic plans to host an investor day in mid-June 2024 to discuss its long-term strategy and growth plans.