Iridium Communications Earnings: Here’s Why the Stock is Falling Now

Iridium Communications Inc. (NASDAQ:IRDM) 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 16.88%.

Iridium Communications Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 21.74% to $0.18 in the quarter versus EPS of $0.23 in the year-earlier quarter.

Revenue: Decreased 2.69% to $94.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Iridium Communications Inc. reported adjusted EPS income of $0.18 per share. By that measure, the company missed the mean analyst estimate of $0.22. It missed the average revenue estimate of $99.31 million.

Quoting Management: “We continue to face short-term challenges in a couple areas of our commercial business, which caused us to revise our 2013 and long-range financial outlook,” said Matt Desch, CEO, Iridium. “In the maritime sector, despite solid new customer additions and a favorable competitive landscape, recently addressed product issues have led to higher churn and tempered our growth prospects. We’re also absorbing lower overall subscriber growth and usage in our core handset offerings, in part from increased competition in the cost-sensitive segment of these markets.”

Key Stats (on next page)…

Revenue increased 6.18% from $89.19 million in the previous quarter. EPS increased 5.88% from $0.17 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 $0.25 to a profit $0.26. For the current year, the average estimate has moved up from a profit of $0.90 to a profit of $0.94 over the last ninety days.

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

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