(By Balaseshan) Finisar Corp. (NASDAQ:FNSR), a provider of optical subsystems and components, reported a decline in fourth quarter earnings due to higher costs and lower telecom revenue. The company guided first quarter results below Street's view, sending its shares down 2.08% in aftermarket.
Earnings from continuing operations for the fourth quarter were $13.16 million or $0.14 per share, down from $16.35 million or $0.17 per share last year.
Adjusted earnings from continuing operations fell to $20.77 or $0.21 per share from $32.67 million or $0.33 per share.
Revenue increased to $239.91 million from $236.95 million.
Analysts had expected a profit of $0.21 per share on revenue of $242.62 million.
The company said continued strength in datacom revenue were offset by lower telecom revenue. The lower telecom revenue were primarily the result of sluggish carrier capital expenditures and the full three month impact of annual price reductions for telecom products.
Gross margin declined to 27.3% from 31.6% reflecting the impact of the annual price reductions for telecom products.
Looking ahead into the first quarter of fiscal 2013, the company expects adjusted earnings of $0.11 to $0.15 per share and revenue of $218 million to $233 million, while Street predicts profit of $0.24 per share on revenue of $250.37 million.
Operating margin is expected in range of about 0.5% to 2.0%, while adjusted operating margin is predicted to be about 5.5% to 7.0% for the first quarter.
While the current level of carrier capital expenditures has muted the near term revenue impact of these new products, the company believes that this progress has set a strong foundation for revenue growth in the second half of 2012 and beyond.
FNSR closed Monday's regular trading down 9.48% at $13.47. The stock has been trading between $12.26 and $23.50 for the past 52 weeks.