What: Shares of Liquidity Services Inc. (NASDAQ:LQDT) were up 10.4% as of 12:00 p.m. ET Thursday after the reverse supply chain specialist released stronger-than-expected fiscal third-quarter 2016 results.
So what: Quarterly revenue declined 5.2% year over year, to $85.2 million, and, based on generally accepted accounting principles (GAAP), translated to a net loss of $0.12 million, or roughly breakeven on a per-share basis. Gross merchandise volume (GMV), which measures the total sales value of all merchandise sold through the company's marketplaces, fell 7.8% year over year, to $178.5 million.
On an adjusted (non-GAAP) basis, which excludes items like share-based compensation, Liquidity Services achieved net income of $2.1 million, or $0.07 per share.
With that in mind, note three months ago Liquidity Services issued guidance for GMV in the range of $150 million to $175 million, and a quarterly adjusted loss per share in the range of $0.13 to $0.07.
Liquidity Services CEO Bill Angrick elaborated, "Our Q3 results were driven by strong volume and velocity of sales across our commercial and government client base as we continue to execute our transformation program, grow our buyer network, enhance our service offerings, and look toward future growth."
Now what: With the caveat that it's still difficult in the near term to forecast sales and margins due to variability in timing of projects, Liquidity Services anticipates fiscal fourth-quarter GMV in the range of $155 million to $170 million, a GAAP net loss per share in the range of $0.20 to $0.10, and an adjusted loss per diluted share in the range of $0.14 to $0.05. For perspective, analysts' consensus estimates predicted a fiscal Q4 adjusted net loss of $0.08 per share, well within Liquidity Services' expected range.
Of course, there's always the possibility that Liquidity Services is under promising with the intention of once again over delivering. But given its reasonably solid guidance and relative outperformance this quarter, it's no surprise to see shares trading higher today.
Steve Symington has no position in any stocks mentioned. The Motley Fool recommends Liquidity Services. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.