CA Earnings: Profit Decrease Causes Investors to Cash In

S&P 500 (NYSE:SPY) component CA Inc. (NASDAQ:CA) reported its results for the second quarter. CA is an information technology software and service company that helps organizations manage and secure their IT infrastructures and services.

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CA Inc. Earnings Cheat Sheet

Results: Net income for the computer software fell to $222 million (48 cents per share) vs. $236 million (47 cents per share) a year earlier. This is a decline of 5.9% from the year-earlier quarter.

Revenue: Fell 4% to $1.15 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: CA Inc. beat the mean analyst estimate of 55 cents per share with adjusted EPS of 59 cents per share. The company fell short of the average revenue estimate of $1.18 billion.

Quoting Management: “While we had anticipated that several areas of our business would be down in the second quarter, our new product and capacity sales fell short of our expectations,” said Bill McCracken, chief executive officer, CA Technologies. “Our performance was also affected by the weakening global economy, which elongated sales cycles. Despite this difficult environment, we were able to meet our expectations for margin through disciplined expense management.”

Key Stats:

The company has now seen net income fall in each of the last two quarters. In the first quarter, net income fell 0.4% from the year-earlier quarter.

The company fell short of forecasts after beating estimates in the previous two quarters. In the first quarter, it topped the mark by 7 cents, and in the fourth quarter of the last fiscal year, it was ahead by 3 cents.

Revenue has dropped in the past two quarters. In the first quarter, revenue declined 1.5% to $1.15 billion from the year-earlier quarter.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the third quarter is 60 cents per share, down from 63 cents ninety days ago. For the fiscal year, the average estimate has moved down from $2.35 a share to $2.34 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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