AudioCodes Ltd (NASDAQ: AUDC) reported a first-quarter FY23 revenue decline of 10.8% year-on-year to $59.21 million, missing the consensus of $62.17 million.

• The software solutions company registered non-GAAP EPS of $0.08 (-75.8%), missing the consensus of $0.17.
• The earnings and revenues miss was due to overall sluggishness in the global economy, resulting in enterprise customers and partners slowing the decision cycle on product purchases, primarily in EMEA. In addition, North American service providers were managing their inventory more tightly.
• Segments: Product Revenue slumped 26.1% Y/Y to $28.69 million. Services revenue rose 10.8% to $30.52 million.
• Margins: Adjusted gross margin was 62.1%, while operating margin was 4.9%.
• Cash and equivalents were $121.5 million as of March 31, 2023.
• CEO Shabtai Adlersberg says the company is "taking decisive actions" to adjust its cost structure and reduce headcount by about 8% to 10% over the next six to 12 months, with approximately 6% effective immediately.
• The Israel-based company has already taken steps to adopt ChatGPT and LLM models in its solutions to enable advanced AI summarization and speech interaction analytics. 
• These steps will provide opex relief starting at the beginning of the third quarter.
• Price Action: AUDC shares are trading higher by 7.11% at $10.70 on the last check Tuesday.