The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Cray beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly, and GAAP earnings per share dropped significantly.
Gross margins increased, operating margins dropped, and net margins expanded.
Cray booked revenue of $91.6 million. The three analysts polled by S&P Capital IQ anticipated a top line of $89.1 million on the same basis. GAAP reported sales were 58% lower than the prior-year quarter's $219.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.85. The two earnings estimates compiled by S&P Capital IQ predicted $0.23 per share on the same basis. GAAP EPS of $0.80 for Q4 were 45% lower than the prior-year quarter's $1.46 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 38.4%, 140 basis points better than the prior-year quarter. Operating margin was 18.7%, 590 basis points worse than the prior-year quarter. Net margin was 33.9%, 1,020 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $99.5 million. On the bottom line, the average EPS estimate is $0.10.
Next year's average estimate for revenue is $404.2 million. The average EPS estimate is $0.60.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 138 members rating the stock outperform and 27 members rating it underperform. Among 32 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 23 give Cray a green thumbs-up, and nine give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cray is buy, with an average price target of $8.75.
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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 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.