Shares of Adesto Technologies (NASDAQ:IOTS) slumped on Wednesday after the provider of application-specific semiconductors reported its third-quarter results. The tech company's numbers were mixed relative to analyst estimates, with the top line coming up short. As of 11:30 a.m. EST, the stock was down 16.7%.
Adesto reported third-quarter revenue of $32 million, up 46.1% year over year but about $0.9 million lower than the average analyst estimate. "We continued to strengthen our position in the industrial market and also advanced engagements with our tier-one consumer customers across portable computing, wearables and smart home applications," said CEO Narbeh Derhacobian.
Non-GAAP (adjusted) earnings per share came in at $0.03, up from a loss of $0.04 in the prior-year period and $0.02 better than analysts were expecting. Adjusted gross margin surged more than 5 percentage points to 51%, combining with revenue growth to drive the bottom line higher.
The company maintained its outlook for 30% revenue growth in the second half of 2019 compared to the second half of 2018.
For the fourth quarter, Adesto expects to grow revenue by 20% year over year to between $32 million and $35 million. Adjusted gross margin is expected between 50% and 52%. "With expanded revenue streams, increasing profitability and a strong balance sheet, the Company is well positioned to drive future growth and shareholder value," said Derhacobian.
While Wednesday was a rough day for the stock, shares of Adesto remain up about 75% since the beginning of 2019.