Critical Path posts strong 1Q results; SGI falls flat
Critical Path (Nasdaq: CPTH) rolled past analysts' estimates in its first quarter Thursday even though it lost $16.8 million, or 33 cents a share, on sales of $24.6 million.
First Call consensus expected it to lose 41 cents a share in the quarter.
Ahead of the earnings report, Critical Path shares fell 2 1/2 to 45 1/8.
The $24.6 million in sales marks a stunning 2,200 percent jump from the year-ago quarter when it lost $5.4 million, or 77 cents a share, on sales of $1.05 million.
"We continued to increase gross margin in the quarter, reflecting the success of our business model and maintaining our path to profitability," said CEO Doug Hickey in a prepared release.
Gross profit margin for the quarter was $9.2 million, a 513 percent increase over gross margin of $1.5 million in the prior quarter.
Critical Path exited the quarter with 15.5 million outsourced mailboxes, up 40 percent from 11.1 million outsourced mailboxes at the close of the fourth quarter. The company also reported that it powers 69.8 million insourced mailboxes and 25 million wireless devices.
Its shares peaked at 88 7/16 in March after falling to a low of 19 1/2 in May.
The computer workstation maker posted a third-quarter loss of $18.1 million, or 10 cents a share, on sales of $563.7 million.
First Call consensus expected it to lose 7 cents a share in the quarter.
Its shares ended off 5/8 to 7 3/4 ahead of the earnings report.
In the year-ago quarter, SGI, formerly known as Silicon Graphics, lost $40 million, or 21 cents a share, on sales of $619.2 million.
Company officials said they were disappointed with the drop in sales, which resulted from the delayed introduction of a new line of processors.
"Notwithstanding, our primary goal is revenue growth, and we remain optimistic about the future," SGI Chairman Bob Bishop said in a prepared release.
Analysts expect SGI to lose 37 cents a share in the fiscal year.>