The 10-second takeaway
For the quarter ended June 30 (Q2), Riverbed Technology beat expectations on revenue and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share improved significantly.
Gross margins dropped, operating margins dropped, and net margins expanded.
Riverbed Technology reported revenue of $198.5 million. The 34 analysts polled by S&P Capital IQ predicted revenue of $194.3 million on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $170.3 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 $0.23. The 35 earnings estimates compiled by S&P Capital IQ forecast $0.21 per share. GAAP EPS of $0.11 for Q2 were 57% higher than the prior-year quarter's $0.07 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 74.9%, 160 basis points worse than the prior-year quarter. Operating margin was 10.1%, 260 basis points worse than the prior-year quarter. Net margin was 9.1%, 250 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $211.3 million. On the bottom line, the average EPS estimate is $0.25.
Next year's average estimate for revenue is $818.7 million. The average EPS estimate is $0.94.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 948 members out of 994 rating the stock outperform, and 46 members rating it underperform. Among 214 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 202 give Riverbed Technology a green thumbs-up, and 12 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Riverbed Technology is outperform, with an average price target of $24.08.
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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. The Motley Fool owns shares of Riverbed Technology. Motley Fool newsletter services recommend Riverbed Technology. 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.