The 10-second takeaway
For the quarter ended March 31 (Q3), MIPS Technologies beat expectations on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank significantly and GAAP earnings per share contracted to a loss.
Margins shrank across the board.
MIPS Technologies tallied revenue of $15.3 million. The five analysts polled by S&P Capital IQ expected revenue of $13.9 million on the same basis. GAAP reported sales were 24% lower than the prior-year quarter's $20.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.01. The five earnings estimates compiled by S&P Capital IQ predicted -$0.03 per share. GAAP EPS were -$0.05 for Q3 against $0.06 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 97.7%, 150 basis points worse than the prior-year quarter. Operating margin was -11.6%, 3,190 basis points worse than the prior-year quarter. Net margin was -16.5%, 3,330 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $15.0 million. On the bottom line, the average EPS estimate is $0.00.
Next year's average estimate for revenue is $61.4 million. The average EPS estimate is $0.02.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 297 members out of 326 rating the stock outperform, and 29 members rating it underperform. Among 58 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 52 give MIPS Technologies a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on MIPS Technologies is outperform, with an average price target of $6.63.
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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.