Slow sales hurt Cabletron stock
The networker's share price dips 7/8 of a point after it reports first-quarter results that reflect a slip in sales.
Cabletron reported sales of $362.7 million for the quarter ending May 31, up 12.1 percent from the same period a year ago.
But earnings were virtually flat at $58.8 million, or 38 cents a share, for the quarter. That compares with net profits of $57.1 million, or 37 cents a share, a year ago.
Wall Street had expected the company to post revised earnings of 37 cents a share, according to First Call. Even though earnings slightly bettered analysts' expectations, the stock took a slight dip in early trading.
Cabletron closed down slightly at 30-3/4 today, 7/8 shy of the stock's close of 31-5/8 on Friday.
Earlier this month the share price plunged more than 30 percent after the company announced preliminary results would fall far short of analysts' expectations. Causes cited were a slowdown in Europe, softer sales for its traditional low-end shared media hub products, and production delays for new SmartSwitch products.
The company said availability issues for SmartSwitch products, a primary cause of the revenue shortcomings in the just-completed quarter, may continue in the current quarter.
Prior to this most recent quarter, Cabletron revenues had grown quarter-to-quarter for more than two years. This first quarter marked the first slowdown on a sequential basis.