The 10-second takeaway
For the quarter ended Dec. 31 (Q2), Oclaro beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly, and GAAP earnings per share shrank.
Margins dropped across the board.
Oclaro booked revenue of $86.5 million. The one analyst polled by S&P Capital IQ expected net sales of $81.1 million. Sales were 28% lower than the prior-year quarter's $120.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at -$0.35. The seven earnings estimates compiled by S&P Capital IQ forecast -$0.38 per share on the same basis. GAAP EPS were -$0.21 for Q2 compared to $0.00 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 12.6%, 1,710 basis points worse than the prior-year quarter. Operating margin was -24.6%, 2,810 basis points worse than the prior-year quarter. Net margin was -36.0%, 3,580 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $95.2 million. On the bottom line, the average EPS estimate is -$0.27.
Next year's average estimate for revenue is $400.7 million. The average EPS estimate is -$0.93.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 122 members out of 158 rating the stock outperform, and 36 members rating it underperform. Among 31 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 27 give Oclaro a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Oclaro is hold, with an average price target of $6.36.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.