Why Fusion-IO, Inc. Shares Faltered Today

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Fusion-IO, plunged more than 10% Thursday after the company released mixed fiscal third-quarter results and underwhelming forward revenue guidance.

So what: Quarterly revenue rose 14.6% year over year, to $100.5 million, which translated to an adjusted net loss of $0.10 per diluted share. Analysts, on average, were looking for a narrower $0.09 per-share loss on sales of just $96.7 million. Adjusted gross margin was also 52.4%, while adjusted operating margin was negative 16.7%.

For the current quarter, Fusion-IO expects revenue to be "in-line to slightly up sequentially." Meanwhile, adjusted gross margin should be in the range of 52% to 54%, and adjusted operating margin should come in around negative 13% to 17%. For reference, analysts are currently modeling a fiscal fourth-quarter loss of $0.06 per share on sales of $107.46 million.

Now what: Curiously, though, Fusion-IO used the exact same cautious verbiage for revenue guidance in both its fiscal first and second quarter reports, when it turned in sales of $86.3 million and $94.5 million, respectively. Once again, though, given Fusion-IO's lack of near-term profitability and significant top-line growth, I still can't get excited about the stock.

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The article Why Fusion-IO, Inc. Shares Faltered Today originally appeared on Fool.com.

Steve Symington has no position in any stocks mentioned. 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.

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