Shares of Acuity Brands (NYSE:AYI) plunged as much as 14.4% in trading Tuesday after the lighting-systems company reported fiscal third quarter 2019 results. They recovered slightly but were still down 10.4% at 11:15 a.m. EDT.
Revenue for the quarter rose just 0.4% to $947.6 million, and operating profit jumped 12% to $120.3 million. Net income rose 21.1% to $88.4 million, and earnings per share were $2.22 -- or $2.53 after adjusting for one-time items.
Results looked good on the surface, but analysts were expecting $971.45 million in revenue, and missing that mark was what really hurt the stock today. Adjusted earnings beat the $2.45 estimate from Wall Street, but revenue was clearly in focus today.
Not only was revenue not what investors had hoped, but management also wasn't terribly bullish, either. It said it was "cautiously optimistic" about operating conditions for the rest of the year but mentioned softening signs in the architecture business. That's why shares are falling today.
Investors will want to wait to see if demand does weaken before jumping ship because Acuity's bottom line is still growing nicely in the rapidly shifting lighting business.