The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Rosetta Stone missed slightly on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted slightly. Non-GAAP earnings per share expanded. GAAP earnings per share expanded.
Margins expanded across the board.
Rosetta Stone notched revenue of $78.7 million. The five analysts polled by S&P Capital IQ expected to see revenue of $80.1 million on the same basis. GAAP reported sales were the same as the prior-year quarter's.
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 $0.15. The two earnings estimates compiled by S&P Capital IQ forecast $0.15 per share. Non-GAAP EPS were $0.15 for Q4 against -$0.24 per share for the prior-year quarter. GAAP EPS were $0.18 for Q4 compared to -$0.24 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 83.6%, 200 basis points better than the prior-year quarter. Operating margin was 6.4%, much better than the prior-year quarter. Net margin was 5.1%, much better than the prior-year quarter.
Next quarter's average estimate for revenue is $67.2 million. On the bottom line, the average EPS estimate is $0.07.
Next year's average estimate for revenue is $289.4 million. The average EPS estimate is $0.30.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 665 members out of 753 rating the stock outperform, and 88 members rating it underperform. Among 167 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 147 give Rosetta Stone a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Rosetta Stone is hold, with an average price target of $13.67.
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