Aruba Networks Goes Red

Before you go, we thought you'd like these...
Before you go close icon

Aruba Networks (NAS: ARUN) reported earnings on May 16. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended April 30 (Q3), Aruba Networks met expectations on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share dropped significantly. GAAP earnings per share contracted to a loss.

Gross margins grew, operating margins shrank, net margins dropped.

Revenue details
Aruba Networks chalked up revenue of $147.1 million. The 19 analysts polled by S&P Capital IQ predicted sales of $146.2 million on the same basis. GAAP reported sales were 12% higher than the prior-year quarter's $131.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.11. The 19 earnings estimates compiled by S&P Capital IQ predicted $0.12 per share. Non-GAAP EPS of $0.11 for Q3 were 31% lower than the prior-year quarter's $0.16 per share. GAAP EPS were -$0.18 for Q3 compared to $0.05 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 70.1%, 10 basis points better than the prior-year quarter. Operating margin was -1.6%, 410 basis points worse than the prior-year quarter. Net margin was -13.7%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $149.0 million. On the bottom line, the average EPS estimate is $0.12.

Next year's average estimate for revenue is $596.1 million. The average EPS estimate is $0.62.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 285 members out of 316 rating the stock outperform, and 31 members rating it underperform. Among 66 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 56 give Aruba Networks a green thumbs-up, and 10 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Aruba Networks is hold, with an average price target of $26.38.

Internet software and services are being consumed in radically different ways, on increasingly mobile devices. Does Aruba Networks fit in anymore? Check out the company that Motley Fool analysts expect to lead the pack in "The Next Trillion-dollar Revolution." Click here for instant access to this free report.

The article Aruba Networks Goes Red originally appeared on

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. 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.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading