The equipment vendor ADTRAN (NASDAQ:ADTN, news, filings) decided not to keep the bad news to itself, and revised its first quarter revenue guidance. Two months ago, the company had projected revenues to remain roughly flat sequentially, or in the $170M range - which is where analysts had placed their bets too. But the company is now forecasting something more like $130-135, a shortfall of more than 20%. Ouch.
Meanwhile, non-GAAP earnings per share are expected to be $0.22-0.25, well short of the $0.40 analysts had projected, but that's entirely to be expected given the revenue number. ADTRAN put the blame for the lower numbers on two factors: a slower than normal start to seasonal buying patterns, and expecially to a delay by a big carrier customer with new system implementation issues to work out. Orders in March have apparently returned to normal, but whether we will see the pendulum swing all the way back the other way in Q2 is another matter.
The equipment sector's winter has had a bit of a 'tale of two cities' flavor, with some providers posting strong numbers and others complaining of soft carrier spending overall. ADTRAN's first quarter seems to add a bit more weight to the winter blues pattern described by Juniper, Acme Packet, and a few others. Hopefully it won't spread further.
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