What happened
Shares of Harmonic (NASDAQ: HLIT) have tanked today, down by 6% as of 12:05 p.m. EDT, after the company reported third-quarter earnings results. The results beat expectations, but guidance for the fourth quarter left a bit to be desired. The stock was down as much as 12% earlier in the morning.
So what
Revenue in the third quarter declined by 18% to $94.9 million, which was ahead of the $82.2 million in sales that analysts were expecting. That translated into adjusted earnings per share of $0.03, while the consensus estimate had called for an adjusted net loss per share of $0.05. The video delivery technology company reported $100.7 million in bookings for the quarter.
Image source: Getty Images.
"Harmonic's third-quarter results were driven by strong performance in both our Cable Access and Video segments," CEO Patrick Harshman said in a statement. "Our Cable Access segment delivered solid sequential revenue growth and operating margin."
Now what
Investors appeared to be disappointed with Harmonic's guidance for the fourth quarter. Revenue is forecast in the range of $120 million to $130 million, which is shy of the $130.9 million in revenue that analysts are currently modeling for. Adjusted EPS is expected to be in the range of $0.10 to $0.18, with the midpoint of that outlook falling short of the $0.17 per share that the Street is looking for.
Adjusted gross margin is expected to be 50.5% to 54.5%, with adjusted EBITDA of $15.5 million to $24 million.
10 stocks we like better than Harmonic
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Harmonic wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of October 20, 2020
Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
