The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Interactive Intelligence met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share shrank significantly.
Gross margins expanded, operating margins dropped, and net margins dropped.
Interactive Intelligence recorded revenue of $57.7 million. The eight analysts polled by S&P Capital IQ expected revenue of $58.0 million. Sales were 14% higher than the prior-year quarter's $50.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.37. The seven earnings estimates compiled by S&P Capital IQ forecast $0.35 per share on the same basis. GAAP EPS of $0.23 for Q4 were 38% lower than the prior-year quarter's $0.37 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 71.1%, 190 basis points better than the prior-year quarter. Operating margin was 11.3%, 690 basis points worse than the prior-year quarter. Net margin was 8.0%, 600 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $55.5 million. On the bottom line, the average EPS estimate is $0.25.
Next year's average estimate for revenue is $246.7 million. The average EPS estimate is $1.20.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 378 members out of 400 rating the stock outperform, and 22 members rating it underperform. Among 133 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 132 give Interactive Intelligence a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Interactive Intelligence is outperform, with an average price target of $35.
Over the decades, small-cap stocks like Interactive Intelligence have produced market-beating returns, provided they're value-priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: 2 Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add Interactive Intelligence to My Watchlist.
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. Motley Fool newsletter services have recommended buying shares of Interactive Intelligence. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.