Rosetta Stone Earnings: Everything You Must Know Now

Rosetta Stone, Inc. (NYSE:RST) had a loss and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

Rosetta Stone, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.03 in the quarter versus EPS of $-0.22 in the year-earlier quarter.

Revenue: Rose 2.12% to $62.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Rosetta Stone, Inc. reported adjusted EPS loss of $0.03 per share. By that measure, the company beat the mean analyst estimate of $-0.12. It missed the average revenue estimate of $63.58 million.

Quoting Management: “I was pleased with our results and would characterize the second quarter as another quarter where we showed steady progress against our strategy and we took meaningful actions to improve future results and move us closer to our 2015 targets,” said Steve Swad, President and Chief Executive Officer of Rosetta Stone. Swad added “We continued our shift to digital, with 25% of Consumer revenue now coming from digital download and Online Learners and increased our online presence through the acquisition of Livemocha. We grew our core business, invested in new products and managed expenses, helping us to deliver impressive growth in Adjusted EBITDA. We also continued to push our transformation forward by closing kiosks, launching our first set of travel apps and extending into the digital reading space with the recent acquisition of Lexia.”

Key Stats (on next page)…

Revenue decreased 2.85% from $63.92 million in the previous quarter. EPS were the same at $-0.03 in the quarter as EPS of $-0.03 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 loss of $0.04 to a loss $0.06. For the current year, the average estimate has moved down from a profit of $0.03 to a profit of $0.01 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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