Infinera Shares Soar 11% As Q3 Results Top Estimates

(RTTNews) - Shares of Infinera Corp. (INFN) surged more than 11 percent in extended trading on Wednesday after the optical transmission equipment maker reported results for the third quarter that topped analysts' expectations.

The company also reported a profit for the quarter that increased from last year, despite lower margins, reflecting strong double-digit revenue growth.

"I'm pleased that we continue to achieve significant revenue growth while expanding our gross margin and profit levels," CEO Tom Fallon said in a statement.

The Sunnyvale, California-based company reported net earnings of $4.84 million or $0.04 per share for the third quarter, higher than $3.35 million or $0.03 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter was $14.17 million or $0.11 per share, compared to net income of $12.76 million or $0.10 per share in the year-ago quarter.

On average, seven analysts polled by Thomson Reuters expected the company to report a loss of $0.07 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter increased to $173.56 million from $142.02 million in the same quarter last year, and topped nine Wall Street analysts' consensus estimate of $170.86 million.

Product revenues for the quarter grew to $147.18 million from $121.33 million, and services revenues increased to $26.38 million from $20.69 million in the prior-year quarter.

Gross margin for the third quarter contracted 470 basis points to 43.4 percent from last year's 48.1 percent.

"Our business outlook remains positive as we've strengthened our product portfolio with the introduction of the Cloud Xpress while enhancing our market leading DTN-X. I believe Infinera has never been better positioned as we continue to deliver what we believe are the right products at the right time," Fallon added.

INFN closed Wednesday's regular trading session at $10.61, down $0.22 or 2.03% on a volume of 2.08 million shares. However, the stock surged $1.19 or 11.22% in after-hours trading.