Interactive Intelligence Earnings Preview

Interactive Intelligence (Nasdaq: ININ  ) didn't hit the Street's expectations last quarter, but investors hope that it will rebound this quarter. The company will unveil its latest earnings on Monday, Oct. 24. Interactive Intelligence is a provider of software application suites for Voice over Internet Protocol business communications.

What analysts say:

• Buy, sell, or hold?: Analysts strongly back Interactive Intelligence, with seven of eight rating it a buy and the remainder rating it a hold. Analysts like Interactive Intelligence better than competitor Smith Micro Software overall. That rating hasn't budged in three months as analysts have remained steadfast in their opinion of the stock.
• Revenue forecasts: On average, analysts predict $53.5 million in revenue this quarter. That would represent a rise of 28% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.27 per share. Estimates range from $0.25 to $0.30.

What our community says:
CAPS All-Stars are solidly behind the stock, with 98.5% awarding it an "outperform" rating. The community at large agrees with the All-Stars, with 94.2% granting it a rating of outperform. Fools are bullish on Interactive Intelligence and haven't been shy with their opinions lately, logging 129 posts in the past 30 days. Even with a robust four out of five stars, Interactive Intelligence's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Interactive Intelligence's profit has risen year over year by an average of 81.9% over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q2	Q1	Q4	Q3
Gross Margin	68.9%	68.1%	69%	69%
Operating Margin	10.6%	10.3%	18%	13.4%
Net Margin	7.4%	6.5%	14%	8.4%

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