The 10-second takeaway
For the quarter ended June 30 (Q2), Rosetta Stone missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP loss per share didn't move.
Margins contracted across the board.
Rosetta Stone notched revenue of $60.8 million. The four analysts polled by S&P Capital IQ expected revenue of $66.0 million on the same basis. GAAP reported sales were 8.9% lower than the prior-year quarter's $66.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.15. The four earnings estimates compiled by S&P Capital IQ anticipated -$0.15 per share. GAAP EPS of -$0.22 were the same as the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 81.4%, 130 basis points worse than the prior-year quarter. Operating margin was -8.3%, 10 basis points worse than the prior-year quarter. Net margin was -7.5%, 70 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $61.5 million. On the bottom line, the average EPS estimate is -$0.16.
Next year's average estimate for revenue is $271.7 million. The average EPS estimate is -$0.21.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 698 members out of 788 rating the stock outperform, and 90 members rating it underperform. Among 154 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 135 give Rosetta Stone a green thumbs-up, and 19 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Rosetta Stone is hold, with an average price target of $12.33.
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