IPG Photonics Earnings: Here’s Why Investors are Not Excited Now

IPG Photonics Corporation (NASDAQ:IPGP) delivered a profit 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 5.80%.

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IPG Photonics Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 9.84% to $0.67 in the quarter versus EPS of $0.61 in the year-earlier quarter.

Revenue: Rose 15.19% to $141.9 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: IPG Photonics Corporation reported adjusted EPS income of $0.67 per share. By that measure, the company missed the mean analyst estimate of $0.7. It missed the average revenue estimate of $150.34 million.

Quoting Management: “IPG’s core materials processing business grew by 29% year-over-year and comprised 94% of our revenues,” said Dr. Valentin Gapontsev, IPG Photonics’ Chief Executive Officer. “Gross margins of 53.3% recovered from Q4 due to improved product mix, lower component costs and enhanced manufacturing efficiency. Order flow remains firm with a book-to-bill ratio solidly in excess of 1. The strong growth in our core materials processing applications was partially offset by lower sales in other applications.”

Key Stats (on next page)…

Revenue decreased 2.16% from $145.03 million in the previous quarter. EPS decreased 0% from $0.67 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.82 to a profit $0.78. For the current year, the average estimate has moved down from a profit of $3.29 to a profit of $3.16 over the last ninety days.

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