FireEye (FEYE) Crashes On Weak Guidance, TASER (TASR) Stock Gains

Nasdaq

Shares of FireEye Inc (NASDAQ:FEYE) plunged by more than 14 percent at $14.35 in after-hours trading Thursday after the company reported its second-quarter earnings results.

The security technology vendor posted an earnings per share loss of $0.33 on revenues of $175 million, up 18.9% from a year ago. Analysts were expecting EPS of ($0.39) on revenues of $181.57 million.

FireEye’s billings —a key metric for firms focused on cloud software, which reflects future revenue under contract — totaled $196.4 million, below consensus for $209.6 million.

CEO Kevin Mandia stated the quarter “showed fundamental strength in several areas — sales of our next generation endpoint offering increased more than 65 percent from a year ago, renewal billings were strong, we added more than 300 new customers, and we closed 40 transactions above $1 million.”

“Although total billings and revenue were below our expectations,” he added, “efforts to optimize our cost structure resulted in a sequential decline in our costs and loss per share exceeded our expectations.”

In terms of guidance for Q3, FireEye expects its per-share earnings to range from ($0.32) – ($0.30) versus consensus of ($0.24) per share. The company said it sees revenue in the range of $180 million to $186 million, compared to the consensus revenue estimate of $208.09 million.

For the full fiscal-year 2016, the cybersecurity firm now expects revenue of $716 million to $728 million, down from the prior outlook for $780 million to $810 million. Net EPS is projected to be a loss between $1.28 to $1.32, against projections of ($1.20) to ($1.27) per share.

Along with earnings that disappointed relative to expectations, FireEye also announced plans to layoff 300 to 400 of its 3,400 workers.

In an interview with MW, FireEye ‘s Chief Financial Officer Michael Berry said “We’ll do our best to go after infrastructure costs, discretionary spending and things like that, but unfortunately we will have to reduce employees as well.”

FireEye stock currently prints a one year loss of about 60.25%, and a year-to-date loss of 16.73% loss.

FEYE chart

Taser International, Inc. (NASDAQ:TASR) reported second-quarter earnings per share of $0.07 after the closing bell Thursday, compared to the consensus estimate of $0.05. Revenues increased 25.9% from last year to $58.8 million. Analysts expected revenues of $54.42 million. Net income came in at $3.7 million, or $0.07 per diluted share, compared to $6.1 million, or $0.11 per diluted share, on a year-over-year basis. International sales for the maker of stun guns and body cameras were $6.5 million in the second quarter of 2016.

“We generated a 26% increase in net sales for the period and set the stage for future performance as highlighted by a more than doubling of Axon bookings year-over-year to a record $72.0 million,” said in a statement Rick Smith, Taser CEO and co-founder.

In the second quarter of 2016, Taser generated $3.2 million in cash from operating activities. Cash, cash equivalents and investments were $91.6 million at June 30, 2016, compared to $118.3 million at Dec. 31, 2015.

Taser stock is currently up $0.32 to $29.27 on 1.41 million shares.

The chart below shows where the equity has traded over the last 52 weeks.

TASR chart

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