In this Market Foolery segment, host Chris Hill and Motley Fool Total Income's Ron Gross unpack the situation at Guess? (NYSE:GES), which saw first-quarter revenue rise a meager 2% as losses hit $21 million. That may not be great out of context, but the company outperformed its own outlook across the board, and its international market performance is the key to its relative success.

A full transcript follows the video.

This video was recorded on May 25, 2017.

Chris Hill: Guess?, or as we pointed out before we started taping, Guess? Because, yes, the question mark is officially part of the name of the company. Guess?, first-quarter revenue rose -- help me understand this -- just 2%. They lost $21 million in the quarter, and the stock is up more than 15% this morning.

Ron Gross: You're obviously not paying attention to the expectations.

Hill: Were they lower than low?

Gross: They beat the high end of their own expectations, their own guidance, in terms of revenue, adjusted operating margin, and earnings per share. In fact, if you adjust some of the numbers to make them comparable, and take away some non-recurring charges, you do have a loss of $19.4 million, but that was only a 0.5% deterioration, which was somewhat better than some folks were expecting. The company has certainly had its struggles. You did see net revenue increase 2.2%, 4% if you look at constant currency. The big story here is international, very strong with Europe and Asia, up 23% and 17% respectively. Good old U.S. of A. very weak, America retail down 15%, dragging down results there.

Hill: I'm glad you mentioned and differentiated between Wall Street's expectations and the company's expectations. Robin Rifkin, one of our longtime listeners out in Seattle, dropped me a note about that this week. We talk about this from time to time, but it's always worth reminding people. A lot of times, when we talk about an "earnings miss" or an "earnings beat," we're focused on the Wall Street analysts, and not what the company is doing. And I think that's maybe part of what we're seeing with the stock today, that Wall Street analysts are looking at it and saying, "Wow, they beat their own expectations, they beat their own guidance." But I'm also wondering if part of what we're seeing with the stock today is short-sellers covering their short.

Gross: It absolutely could be. Wall Street estimates are often based on company guidance, or company's estimates. Wall Street analysts need to take into account whether they believe the company, whether they're being too optimistic or pessimistic or sandbagging. That's why sometimes you'll see analysts come in with estimates lower than the company's own internal estimates, because they're saying, "They're being too rosy here, they've consistently underperformed and they're not going to hit these numbers, we're going to be conservative and come in lower." Then, occasionally, you'll see a company beat, and then you see the stock pop.

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