Ruckus Building

Image source: Ruckus Wireless.

Ruckus Wireless (NYSE:RKUS) released fourth-quarter 2015 results Tuesday after the market close. And though its quarterly performance might not look overwhelmingly positive at first glance, shares climbed as much as 19.7% early Wednesday as investors celebrated Ruckus' relative strength and encouraging outlook.

Let's take a closer look at what the mobile wireless infrastructure specialist achieved.

Ruckus Wireless results: The raw numbers

 

Q4 2015 Actuals

Q4 2014 Actuals

Growth (YOY)

Revenue

$100.1 million

$85.9

 16.6%

GAAP Net Income

$2.8 million

$2.9 million

 (3.6%)

Net Income Per Share

$0.03

$0.03

 0%

YOY: Year over year. Data source: Ruckus Wireless.

What happened with Ruckus Wireless this quarter?

  • On a non-GAAP (adjusted) basis, Ruckus Wireless' operating margin came in at 14%.
  • Adjusted net income climbed 15.7% year over year to $13.4 million, or $0.13 per share.
  • Ruckus' guidance called for revenue in the range of $99 million to $104 million, and adjusted net income per share of $0.11 to $0.14.
  • Cash from operations jumped 175% from last year's fourth quarter, to $14.4 million.
  • Added 4,300 enterprise end-customers, bringing total enterprise customer base to over 65,000
  • Added 11 new service provider end-customers, bringing total service provider customer base to over 260.
  • Shipped Virtual SmartZone Data Plane (vSZ-D), the industry's first virtual data plan for Wi-Fi that segregates data traffic from control traffic on large wireless networks
  • Selected by Western Sydney University to roll out next-gen high-capacity, high-speed Wi-Fi to serve over 40,000 students.
  • Installed 802.11ac access points at Brazil's Universidade Nove de Julho, across five campuses serving 150,000 students.
  • 802.11ac access points accounted for 79% of access point product sales, up from 74% in Q3.
  • On a geographic basis, Americas revenue climbed 17.3% year over year, EMEA revenue rose 25.4%, and APAC climbed 5.9%.

What management had to say 
Ruckus Wireless CEO Selina Lo stated:

Our fourth-quarter revenue was affected by a multimillion-dollar E-rate opportunity that was postponed late in the quarter. Nevertheless, we achieved non-GAAP operating margin at the high end of guidance, demonstrating strong operating execution. I believe our strategy remains sound and our product portfolio differentiated, keeping Ruckus in a position to outgrow the market again in 2016. We are equally focused on driving bottom-line growth in 2016, and we are committed to grow earnings faster than revenue, driving operating margin expansion throughout the year.

Looking forward 
For the current quarter, Ruckus Wireless expects revenue in the range of $96 million to $101 million, operating margin of 8.5% to 11%, and adjusted earnings per diluted share of $0.08 to $0.10. By contrast, analysts anticipated earnings right at the midpoint of Ruckus' guidance range, and revenue of $99.3 million. 

However, investors are rightly encouraged that Ruckus was able to achieve these solid results despite the postponed multimillion-dollar E-rate opportunity mentioned by Lo. What's more, it's good to see cash from operations rebound this quarter, especially after watching the metric plummet 48% year over year along with mediocre growth in Q3. Considering Ruckus is also aiming for earnings to outgrow revenue as operating margins expand in the coming year -- and with shares still down nearly 25% year to date -- it's no surprise investors are bidding up Ruckus Wireless stock today.

Steve Symington has no position in any stocks mentioned. The Motley Fool recommends Ruckus Wireless. 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.