Why Silicon Graphics Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Silicon Graphics (NASDAQ: SGI  ) have popped today by greater than 17% after the company reported solid earnings along with rosy guidance.

So what: Revenue in the quarter came in at $171 million, which resulted in non-GAAP earnings per share of $0.10. The company had already released preliminary figures in early January, so there were no real surprises. While those figures were better than expected, guidance was particularly strong.

Now what: For the current quarter, Silicon Graphics expects revenue to be in the range of $200 million to $230 million. Revenue guidance includes $50 million of low-margin deals that the company already disclosed. That should turn into non-GAAP earnings per share of $0.12 to $0.18 after everything is said and done, which is significantly better than the penny per share profit that analysts were modeling for.

Interested in more info on Silicon Graphics? Add it to your watchlist by clicking here.

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