ION Geophysical Earnings: Here’s Why Investors are Not Happy Now

ION Geophysical Corporation (NYSE:IO) had a loss and missed Wall Street’s expectations, AND 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 down 8.56%.

ION Geophysical Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $0.0 in the quarter versus EPS of $0.08 in the year-earlier quarter.

Revenue: Rose 14.93% to $120.92 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: ION Geophysical Corporation reported adjusted EPS loss of $0 per share. By that measure, the company missed the mean analyst estimate of $0.07. It missed the average revenue estimate of $127.48 million.

Quoting Management: Brian Hanson, the Company’s President and Chief Executive Officer, commented, “Overall, the first half of the year was challenging. While our first half revenues were up 16%, our operating margins were down due to cost overruns as we completed acquisition on our first 3D marine program. The pipeline of new venture programs looks solid but is heavily weighted toward the back half of the year. Once again, we are acquiring data in the Arctic, and our land ResSCAN™ programs are gearing up this coming quarter. As a result, we have only spent about 25% of our planned 2013 Cap Ex budget in the first half of the year. Our data processing business again generated record revenues, driven by strong demand in Europe, the Middle East and the Gulf of Mexico, and continued demand for our broadband processing solution, WiBand™. Our systems and software businesses are being pressured by consolidation in the towed steamer market and a reduction in seabed contractors, with RXT’s recent filing for bankruptcy. We expect to see modest improvements in these areas of our business over the back half of the year.”

Key Stats (on next page)…

Revenue decreased 6.8% from $129.74 million in the previous quarter. EPS decreased to $0.0 in the quarter versus EPS of $0.01 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.14 and has not changed. For the current year, the average estimate has moved up from a profit of $0.42 to a profit of $0.43 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

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