Why Calix Stock Plummeted by 5% on Tuesday

Investors didn’t like the guidance the company proffered in its latest earnings report.

Broadband communications specialist Calix (CALX -5.18%) likely felt that investors were hanging up on its stock Tuesday. The company published its first-quarter results, and while there were numerous developments to like, investors weren’t cheered by what management saw in their crystal ball. As a result, the stock’s price fell by more than 5% on a day when the S&P 500 index was well in positive territory with a 1.2% increase.

A pair of quarterly declines

Calix’s first-quarter results showed that the company suffered a decline in revenue; it slid by nearly 10% to slightly over $226 million for the period. Compounding this, it didn’t reach the average analyst estimate, which was $228 million and change.

As for the bottom line, Calix saw a more pronounced tumble in non-GAAP (adjusted) net income. This came in at $14.4 million, well under the almost $21.5 million of the year-ago quarter. On the bright side, however, the $0.21 per share narrowly beat the consensus analyst estimate of $0.20.

In a letter to shareholders, CEO Michael Weening and CFO Cory Sindelar attributed the revenue and profitability drops to factors such as mid- and large-sized customers pausing buys “while they reevaluate their near-term purchase and build decisions.”

Second-quarter guidance didn’t meet the consensus figures

Compounding that, Calix proffered guidance that came in below prognosticator expectations. For its second quarter, the company believes it will post $197 million to $203 million in revenue, and post headline net income of $0.03 to $0.09 per share.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Source link

About The Author

Scroll to Top