Shares of Ubiquiti Networks Inc. (UI 0.11%) were up 14.6% as of 1:30 p.m. EST Friday after the network technology specialist announced stronger-than-expected fiscal first-quarter 2019 results.
More specifically, Ubiqiuiti's quarterly revenue climbed 15.1% year over year to $282.9 million, translating to a 27.2% increase in adjusted earnings per share, to $1.17. Most investors would have settled for earnings of $0.93 per share on revenue closer to $252 million.
Within Ubiquiti Networks' top line, 41.2% growth in enterprise technology segment sales (to $177.9 million) more than offset a 12.5% decline from the service provider technology segment (to just under $105 million).
The company also announced its board has approved a new $200 million stock repurchase program.
Ubiquiti also reminded investors that it expects to incur incremental costs from recent tariffs on products imported into the U.S. from China, so it anticipates gross margin will come under pressure in the near term. Over the long term, however, the company anticipates it will be able to mitigate the effects of those tariffs and keep gross margins within its 45% to 50% target range.
In the meantime, looking ahead to the full year, Ubiquiti Networks reaffirmed its previous guidance for fiscal 2019 revenue in the range of $1.1 billion to $1.2 billion, with earnings per share of $4.00 to $4.80. So given its relative outperformance to start the year, its big new share repurchase program, and confidence in its ability to achieve its full-year outlook, the stock is responding in kind today.