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What: Shares of VeriFone Systems have plunged today by as much as 20% today after the company announced earnings with soft guidance.
So what: Non-GAAP revenue in the second quarter came in at $430 million, shy of the $440.3 million consensus estimate. The company posted non-GAAP net income per share of $0.42, similarly short of the $0.47 per share adjusted profit that investors were expecting. Interim CEO Richard McGinn said the company is "keenly aware" of the challenges it faces, but is investing heavily in a turnaround.
Now what: Guidance for the third quarter calls for adjusted revenue of about $400 million, with adjusted earnings per share in the ballpark of $0.20. That forecast is significantly below the $460.5 million in sales and $0.50 per share profit that the Street was modeling for. Jefferies is keeping a hold rating while lowering its price target to $16, while UBS is defending its buy rating and says the problems are fixable.
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The article Why VeriFone Systems Shares Plunged originally appeared on Fool.com.
Fool contributor Evan Niu, CFA, 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.