Yesterday, after the closing bell, videoconferencing equipment
), posted mixed financial results for the third quarter of 2013.
However, the company provided a disappointing financial outlook
for the ensuing fourth quarter.
GAAP net loss in the third quarter of 2013 was $24 million or
14 cents per share compared with $14.8 million or 8 cents per
share in the prior-year quarter. However, quarterly adjusted
(excluding special items) earnings per share of 2 cents fell
below the Zacks Consensus Estimate of 4 cents.
Total revenue in the third quarter of 2013 was $336.5 million,
up 0.3% year over year and nominally above the Zacks Consensus
Estimate of $336 million. Segment wise, Product revenues were
$242.5 million, down 1.8% year over year. Service revenues were
$94 million, up 6.4% over the prior-year quarter.
Technological Distribution of Sales
UC Group Systems revenues were $221.4 million, down 2% year
over year. UC Personal Devices revenues were $56.9 million, up
24% from the year-ago quarter. UC Platform (Network
Infrastructure) revenues were $58.2 million, down 9% year over
Geographic Distribution of Sales
The Americas (North and South) generated approximately $177.3
million of revenues, up 4% year over year. Europe, the Middle
East and Africa generated $80 million, up 2% year over year. The
Asia-Pacific region accounted for the remaining $79.2 million,
down 8% year over year.
Gross margin in the reported quarter was 58% compared with
58.5% in the year-ago quarter. Quarterly operating expenses were
$217.4 million, up 1.5% year over year. Quarterly operating
margin was -6.6% compared with -5.3% in the year-ago quarter.
At the end of third quarter of 2013, Polycom had nearly $953.8
million of cash and marketable securities on its balance sheet
compared with $724.6 million at the end of 2012. The total debt
was $250 million and the debt-to-capitalization ratio was
Cash flow from operations, during the first nine months of
2013, was $117.5 million against $121.4 million in the year-ago
period. Free cash flow, during the reported period, was $75.7
million compared with $69.4 in the prior-year comparable
Management stated that the company's total revenue for the
fourth quarter of 2013 is likely to be in the range of $336-$346
million. Its mid-point of $341 million is well below the current
Zacks Consensus Estimate of $352 million.
GAPP earnings per share are anticipated between a loss of 1
cent and an income of 2 cents per share. Non-GAAP earnings per
share is likely to range from 13-16 cents. Assuming an average
stock-based compensation of 10 cents per share, the mid-point of
the non-GAAP earnings per share of 4.5 cents is well below the
current Zacks Consensus Estimate of 9 cents.
Other Stocks to Consider
Polycom currently has a Zacks Rank #3 (Hold). Other stocks
worth considering in this sector include
). While Harris and ShoreTel have a Zacks Rank #1 (Strong Buy),
Ericsson has a Zacks Rank #2 (Buy).
ERICSSON LM ADR (ERIC): Free Stock Analysis
HARRIS CORP (HRS): Free Stock Analysis Report
POLYCOM INC (PLCM): Free Stock Analysis
SHORETEL INC (SHOR): Free Stock Analysis
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