What: Shares of InvenSense (NYSE:INVN) fell as much as 20.5%, then partially recovered to trade down 13.3% as of 11:00 a.m. ET Tuesday after the motion sensor chip company released solid fiscal-fourth quarter 2016 results, but followed with disappointing guidance.
So what: Quarterly revenue declined 19.9% year over year, to $79.5 million, within InvenSense's guidance for revenue of $77 million to $83 million. Adjusted gross margin rose 1 percentage point over the same period, to 45%, near the high end of the company's 44% to 45% outlook. Based on generally accepted accounting principles (GAAP), that resulted in a net loss of $22.9 million, or $0.25 per share. But on an adjusted (non-GAAP) basis -- which excludes $0.13 per share related to stock-based compensation and intangibles and $0.14 per share from more unusual income tax valuation allowance increases -- InvenSense's net income came in at $0.02 per share, also near the high end of guidance, which called for adjusted net income in the range of breakeven to $0.02 per share.
By comparison -- and with the caveat that we don't lend much credence to Wall Street's near-term expectations -- analysts' consensus estimates predicted InvenSense would turn in roughly the same adjusted earnings of $0.02 per share on revenue of $79.9 million.
InvenSense CEO Behrooz Abdi added, "Q4 was a solid quarter, capping off a productive year for InvenSense. [...] Our market-leading solutions continued to gain traction in emerging Internet of Things (IoT) platforms such as drones, virtual and augmented reality, wearables, smart home, and industrial applications."
Steve Symington owns shares of InvenSense. The Motley Fool owns shares of and recommends InvenSense. 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.