Aruba Networks Q3 Loss Narrows - Update

(RTTNews) - Wireless-network equipment maker Aruba Networks Inc. (ARUN), Thursday said its loss for the third quarter narrowed from a year ago, driven largely by a 28 percent jump in revenues. Earnings for the quarter came in line with analysts' estimates, while revenues trumped expectations. However, shares of the company slipped over six percent in extended trading hours.

Sunnyvale, California-based Aruba's third-quarter loss narrowed to $6.4 million or $0.06 per share from $20.2 million or $0.18 per share last year.

Adjusted earnings for the quarter rose to $22.8 million or $0.20 per share from $14.0 million or $0.11 per share last year. On average, 31 analysts polled by Thomson Reuters expected earnings of $0.20 per share for the quarter. Analysts' estimates typically exclude special items.

Aruba's revenues for the third quarter rose 28 percent to $188.8 million from $147.1 million last year. Thirty analysts had a consensus revenue estimate of $180.80 million for the quarter.

Third-quarter gross margins dropped to 70.5 percent from 72.3 percent last year.

Commenting on the results, Chief Executive Dominic Orr said, "We delivered record revenue driven by strong demand across our product portfolio. We believe our exceptional topline performance this quarter reflects the investment we made in extending our sales and channel capacity, coupled with the strength of our differentiated architecture and product portfolio."

Financial Chief Michael Galvin said, "Looking forward, we remain confident in our 71 to 73 percent gross margin target range as we introduce new 802.11ac products and see a more balanced product mix."

ARUN closed Thursday's trading at $20.06, up $0.14 or 0.70%, on the Nasdaq. The stock, however, dropped $1.46 or 7.28% in after-hours trade.