Alliance Fiber Optic Products Earnings: Here’s Why the Stock is Rising Now

Alliance Fiber Optic Products Inc. (NASDAQ:AFOP) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 3.99%.

Alliance Fiber Optic Products Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 206.25% to $0.49 in the quarter versus EPS of $0.16 in the year-earlier quarter.

Revenue: Rose 64.79% to $19 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Alliance Fiber Optic Products Inc. reported adjusted EPS income of $0.49 per share. By that measure, the company beat the mean analyst estimate of $0.47. It missed the average revenue estimate of $19.1 million.

Quoting Management: Peter Chang, President and Chief Executive Officer, commented, “We are very pleased with the exceptional financial performance and progress AFOP made in the quarter ended June 30, 2013. With excellent efforts by our Asia operations, we managed unexpected demand increases and delivered much higher than originally guided quarterly revenues. With our focus on operational excellence, we continued to improve gross margins to a record level above 38%, which resulted in a 132% increase in profits based on our 57% revenue growth from the previous quarter. In addition, our balance sheet becomes stronger with improved inventory turn and a higher net cash balance.”

Key Stats (on next page)…

Revenue increased 56.38% from $12.15 million in the previous quarter. EPS increased 104.17% from $0.24 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.29 to a profit $0.47. For the current year, the average estimate has moved up from a profit of $1.09 to a profit of $1.65 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]