What happened

Shares of Casa Systems (NASDAQ:CASA) plunged today, down 11% at the close, after the company reported first-quarter earnings last night.

So what

Revenue in the first quarter came in at $89.1 million, which was ahead of the consensus estimate of $86.5 million. Non-GAAP net income was $21.6 million, or $0.23 per share. That was right on target with what the Street was expecting. Casa posted adjusted EBITDA of $29.5 million, although gross margin contracted to 69.6%.

Red stock chart going down

Image source: Getty Images.

Free cash flow improved significantly to $48.6 million, thanks to a boost in operating cash flow.

Now what

"I am pleased to report that we had another strong quarter," CEO Jerry Guo said in a statement. "We are seeing continued growth across our business. During the quarter, DOCSIS 3.1 deployments accelerated with our MSO customers, deployments of our small cell solutions have begun with our mobile customers, and 5G/4G core trials gained momentum with existing and prospective mobile customers."

Casa is reaffirming the outlook that it provided in March, and still expects full-year 2018 revenue to be in the range of $380 million to $395 million. That should translate into non-GAAP net income of $100 million to $111 million, or $1.08 to $1.19 per share.

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