Acme Packet Earnings Preview: Enough Talk, Let's See Some Numbers

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Acme Packet (NAS: APKT) will step up to the earnings plate to take a swing tonight after market close, and investors are expecting it to be a volatile one -- at least, if you ask the options market.

Shares have fallen spectacularly from the high of $84.50 reached just over a year ago, worth just a third of what they were. Part of what's driven the drop are concerns over Acme Packet's ability to deliver big deals at carrier customers AT&T (NYS: T) and Verizon (NYS: VZ) .

In October, CEO Andy Ory assured investors that a big order with Ma Bell was still being booked, but that it was seeing delays and merely being pushed back into the fourth quarter. Acme Packet even reaffirmed its full-year outlook at the time to back up this belief. A few months later, that full-year outlook was slashed, with the company citing "uncertainty in North American service provider markets," sparking concerns that Big Red was cutting back.


Its official fourth-quarter results received a warm welcome, in that there weren't more disappointing developments to report.

This time around, analysts are forecasting revenue to be $69.3 million, which would represent a 6.3% decline from the year before. Earnings per share are also expected to shrink to $0.17, a dime less than the first quarter of 2011. I'll be looking at what happens to the product portion of revenue, because that will give a clearer hint to Acme Packet's prospects as carriers use its session border controllers to lay the groundwork for the inevitable shift to Voice-over-LTE, or VoLTE.

If Acme Packet can deliver this time around, it will help the company and Ory regain some credibility. Ory's overpromising and underdelivering earned him a Foolish CEO Gaffe of the Week, but the long-term story remains compelling if the company can walk the talk.

While Acme Packet tries to redeem itself, The Motley Fool's Top Stock for 2012 continues to hit new highs. This company is tapping explosive retail growth in emerging markets and is flirting with a new high as we speak. Get the free report now.

At the time this article was published Fool contributorEvan Niuowns shares of Verizon Communications and AT&T, but he holds no other position in any company mentioned.Click hereto see his holdings and a short bio.Motley Fool newsletter serviceshave recommended buying shares of Acme Packet. The Motley Fool has adisclosure policy.We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

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