Limelight Networks Earnings: Here’s Why the Stock is Falling Now

Limelight Networks, Inc. (NASDAQ:LLNW) 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 4.76%.

Limelight Networks, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.07 in the quarter versus EPS of $-0.05 in the year-earlier quarter.

Revenue: Decreased 3.71% to $42.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Limelight Networks, Inc. reported adjusted EPS loss of $0.07 per share. By that measure, the company missed the mean analyst estimate of $-0.05. It missed the average revenue estimate of $45.93 million.

Quoting Management: “Today Limelight reported revenue for the second quarter of 2013 of $42.8 million and an adjusted EBITDA loss of approximately $500,000. This quarter’s results while disappointing, reflect the impact of changes we are making to implement our long term mission of helping customers better engage digital audiences,” said Bob Lento, Chief Executive Officer. “We have launched several initiatives bringing renewed discipline and speed to product development and network operations. Customer support and satisfaction is a top priority, as is ensuring that Limelight is an employer of choice in our markets. We have also established a clear process for identifying customers who value quality, performance, availability, and service, while moving away from contracts that do not provide long-term economic value. These changes, while necessary, may affect short-term results. With these initiatives underway, we are accelerating time to market for product releases, increasing network capacity, and driving sales efficiencies.”

Key Stats (on next page)…

Revenue decreased 6.57% from $45.81 million in the previous quarter. EPS increased to $-0.07 in the quarter versus EPS of $-0.04 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 loss of $0.05 and has not changed. For the current year, the average estimate is a loss of $0.18, which is the same with that ninety days ago.

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

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