The 10-second takeaway
For the quarter ended March 31 (Q1), Ixia beat expectations on revenue and met expectations on earnings per share.
Compared to the prior-year quarter, revenue improved and GAAP earnings per share contracted significantly.
Gross margin expanded, operating margin shrank, and net margin contracted.
Ixia logged revenue of $85.6 million. The seven analysts polled by S&P Capital IQ hoped for revenue of $83.5 million on the same basis. GAAP reported sales were 9.2% higher than the prior-year quarter's $78.5 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 $0.15. The six earnings estimates compiled by S&P Capital IQ forecast $0.15 per share on the same basis. GAAP EPS of $0.06 for Q1 were 40% lower than the prior-year quarter's $0.10 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 80.3%, 10 basis points better than the prior-year quarter. Operating margin was 9.0%, 420 basis points worse than the prior-year quarter. Net margin was 5.1%, 400 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $86.1 million. On the bottom line, the average EPS estimate is $0.16.
Next year's average estimate for revenue is $352.3 million. The average EPS estimate is $0.68.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 55 members out of 65 rating the stock outperform, and 10 members rating it underperform. Among 20 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 19 give Ixia 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 Ixia is outperform, with an average price target of $14.58.
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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.