Why 21Vianet Shares Tanked
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 21Vianet (NAS: VNET) tanked by as much as 11% today after the company reported second-quarter earnings results below expectations.
So what: The company, which is the largest carrier-neutral Internet data center services provider in China, posted revenue of $57.4 million, a gain of 58.2% from a year ago. That translated into a net profit of $2.9 million, compared to a net loss in the same quarter last year.
Now what: That bottom line was only about half of what analysts were looking for, though. Additionally, 21Vianet's revenue was also on the low end of its guidance for the quarter. CEO Josh Chen said the company achieved a new milestone with the opening of its new self-built data centers, although these did not come online until the end of June. 21Vianet met its revenue guidance, but just barely.
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The article Why 21Vianet Shares Tanked originally appeared on Fool.com.Fool contributorEvan Niuholds no position in any company mentioned.Click hereto see his holdings and a short bio. 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.