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What: Shares of Riverbed (RVBD.DL) have plunged today by as much as 17% after the company reported worse-than-expected earnings.
So what: Adjusted revenue for the quarter was $255 million, slightly below the $257.7 million forecast. Non-GAAP earnings per share of $0.22 was right on target with expectations. Guidance was also soft due to weak government spending.
Now what: CEO Jerry Kennelly said that government spending had slowed due to sequestration, which led to the sales shortfall. The challenges are expected to continue, as its third-quarter sales outlook is $265 million to $270 million. The Street was modeling for $275 million in revenue next quarter. Kennelly also acknowledged that Riverbed still has some work ahead of it with integrating its recent OPNET acquisition.
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