The 10-second takeaway
For the quarter ended June 30 (Q2), Riverbed Technology missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. Non-GAAP earnings per share contracted. GAAP earnings per share dropped to a loss.
Margins shrank across the board.
Riverbed Technology logged revenue of $249.9 million. The 30 analysts polled by S&P Capital IQ expected sales of $257.7 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $198.5 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 $0.22. The 30 earnings estimates compiled by S&P Capital IQ averaged $0.22 per share. Non-GAAP EPS of $0.22 for Q2 were 4.3% lower than the prior-year quarter's $0.23 per share. GAAP EPS were -$0.10 for Q2 compared to $0.11 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 71.8%, 310 basis points worse than the prior-year quarter. Operating margin was -1.3%, much worse than the prior-year quarter. Net margin was -6.6%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $274.9 million. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $1.08 billion. The average EPS estimate is $0.99.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 989 members out of 1,038 rating the stock outperform, and 49 members rating it underperform. Among 235 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 225 give Riverbed Technology a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Riverbed Technology is hold, with an average price target of $17.24.
Internet software and services are being consumed in radically different ways, on increasingly mobile devices. Does Riverbed Technology fit in anymore? Check out the company that Motley Fool analysts expect to lead the pack in "The Next Trillion-dollar Revolution." Click here for instant access to this free report.
- Add Riverbed Technology to My Watchlist.
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 recommends Riverbed Technology. The Motley Fool owns shares of 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.