HIVE - "revenue warnings could signal trouble"
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Posted On: 01/17/2018 11:40:48 AM
HIVE - "revenue warnings could signal trouble"
UPDATE: Aerohive, A10 revenue warnings could signal trouble for networking-sector earningsFont size: A | A | A
10:17 AM ET 1/17/18 | MarketWatch
RELATED QUOTES
11:35 AM ET 1/17/18
Symbol Last % Chg
ATEN
6.15 -15.87%
HIVE
3.99 -30.09%
Real time quote.
UPDATE: Aerohive, A10 revenue warnings could signal trouble for networking-sector earnings By Wallace Witkowski, MarketWatch
Shares plummet after both companies forecast disappointing revenue
The possibility of weakness in the computer network software space in the current quarter raised its head late Tuesday after two companies cut their forecasts for the quarter within minutes of each other, sending their respective shares significantly lower.
Shares of Aerohive Networks Inc.(HIVE) fell 28% and shares of A10 Networks Inc. (ATEN) dropped 18% in Wednesday morning trading.
Late Tuesday, Aerohive warned that fourth-quarter revenue would be in the ballpark of $37 million, following its previous forecast of $40 million to $42 million. The company expects a net loss of $3 million to $4 million, but a non-GAAP operating profit after subtracting stock-based compensation and other effects. Analysts surveyed by FactSet had estimated break-even results on revenue of $40.9 million.
"Following the change in our sales leadership at the end of our third quarter, we uncovered underlying sales execution issues which became fully apparent in the last month of the fourth quarter," Chief Executive David Flynn said in Tuesday's announcement. "We have taken actions to replace underperforming sales team members, and we believe that the new people we have been putting in place, combined with other actions, will enable us to capitalize on our improved product offering and exciting roadmap in 2018."
A10 Networks forecast fourth-quarter revenue of $55.5 million to $56 million, down from its prior forecast range of $64 million to $67 million, and expects earnings of 5 cents to 6 cents a share, compared with a previous estimated range of 1 cent to 7 cents a share.
Analysts surveyed by FactSet had estimated earnings of 3 cents a share on revenue of $65.1 million.
"We are disappointed with our revenue results for the quarter, which were below our guidance primarily due to a shortfall in North America sales as we experienced lower-than-expected seasonal demand trends in the region," said Lee Chen, A10 president and chief executive, in a statement.
Aerohive and A10 both expect to report fourth-quarter earnings on Feb. 8.
Among competitors in the network software space, shares of Cisco Systems Inc. (CSCO) gained 0.9% in Wednesday morning trading. Shares of Juniper Networks Inc. (JNPR) fell 0.8%, shares of Citrix Systems Inc.(CTXS) rose 0.5%, and shares of F5 Networks Inc.(FFIV) dropped 0.7%.
-Wallace Witkowski; 415-439-6400; AskNewswires@dowjones.com
> Dow Jones Newswires
January 17, 2018 10:17 ET (15:17 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
UPDATE: Aerohive, A10 revenue warnings could signal trouble for networking-sector earningsFont size: A | A | A
10:17 AM ET 1/17/18 | MarketWatch
RELATED QUOTES
11:35 AM ET 1/17/18
Symbol Last % Chg
ATEN
6.15 -15.87%
HIVE
3.99 -30.09%
Real time quote.
UPDATE: Aerohive, A10 revenue warnings could signal trouble for networking-sector earnings By Wallace Witkowski, MarketWatch
Shares plummet after both companies forecast disappointing revenue
The possibility of weakness in the computer network software space in the current quarter raised its head late Tuesday after two companies cut their forecasts for the quarter within minutes of each other, sending their respective shares significantly lower.
Shares of Aerohive Networks Inc.(HIVE) fell 28% and shares of A10 Networks Inc. (ATEN) dropped 18% in Wednesday morning trading.
Late Tuesday, Aerohive warned that fourth-quarter revenue would be in the ballpark of $37 million, following its previous forecast of $40 million to $42 million. The company expects a net loss of $3 million to $4 million, but a non-GAAP operating profit after subtracting stock-based compensation and other effects. Analysts surveyed by FactSet had estimated break-even results on revenue of $40.9 million.
"Following the change in our sales leadership at the end of our third quarter, we uncovered underlying sales execution issues which became fully apparent in the last month of the fourth quarter," Chief Executive David Flynn said in Tuesday's announcement. "We have taken actions to replace underperforming sales team members, and we believe that the new people we have been putting in place, combined with other actions, will enable us to capitalize on our improved product offering and exciting roadmap in 2018."
A10 Networks forecast fourth-quarter revenue of $55.5 million to $56 million, down from its prior forecast range of $64 million to $67 million, and expects earnings of 5 cents to 6 cents a share, compared with a previous estimated range of 1 cent to 7 cents a share.
Analysts surveyed by FactSet had estimated earnings of 3 cents a share on revenue of $65.1 million.
"We are disappointed with our revenue results for the quarter, which were below our guidance primarily due to a shortfall in North America sales as we experienced lower-than-expected seasonal demand trends in the region," said Lee Chen, A10 president and chief executive, in a statement.
Aerohive and A10 both expect to report fourth-quarter earnings on Feb. 8.
Among competitors in the network software space, shares of Cisco Systems Inc. (CSCO) gained 0.9% in Wednesday morning trading. Shares of Juniper Networks Inc. (JNPR) fell 0.8%, shares of Citrix Systems Inc.(CTXS) rose 0.5%, and shares of F5 Networks Inc.(FFIV) dropped 0.7%.
-Wallace Witkowski; 415-439-6400; AskNewswires@dowjones.com
> Dow Jones Newswires
January 17, 2018 10:17 ET (15:17 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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