The 10-second takeaway
For the quarter ended March 31 (Q4), QLogic beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share dropped significantly. GAAP earnings per share dropped significantly.
Gross margins grew, operating margins contracted, net margins shrank.
QLogic booked revenue of $116.9 million. The 12 analysts polled by S&P Capital IQ hoped for revenue of $115.3 million on the same basis. GAAP reported sales were 13% lower than the prior-year quarter's $135.1 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 $0.17. The 14 earnings estimates compiled by S&P Capital IQ averaged $0.16 per share. Non-GAAP EPS of $0.17 for Q4 were 50% lower than the prior-year quarter's $0.34 per share. (The prior-year quarter included $1.08 per share in earnings from discontinued operations.) GAAP EPS of $0.33 for Q4 were 76% lower than the prior-year quarter's $1.37 per share. (The prior-year quarter included $1.08 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 67.7%, 10 basis points better than the prior-year quarter. Operating margin was 8.9%, much worse than the prior-year quarter. Net margin was 25.3%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $113.9 million. On the bottom line, the average EPS estimate is $0.16.
Next year's average estimate for revenue is $478.1 million. The average EPS estimate is $0.75.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 279 members out of 297 rating the stock outperform, and 18 members rating it underperform. Among 75 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 72 give QLogic a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on QLogic is hold, with an average price target of $11.05.
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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 has no position in any of the stocks mentioned. 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.