Avanex Soars on Q4 Forecast
Finally, Avanex Corp. (Nasdaq: AVNX) catches a break.
The long-struggling optical components firm saw its stock climb 24 cents (14.6 percent) to $1.88 yesterday after officials announced earnings forecasts that beat Wall Street estimates.
Avanex said it expects to report fourth quarter earnings on Sept. 5, right after the Labor Day holiday in the U.S. Revenues should be around $45.5 million -- beating out the $44 million analysts were expecting, according to Reuters Research . (See Avanex Forecasts Q4.)
Better still, Avanex said revenues for the first quarter of 2007, which ends in September, should be $48 million to $50 million -- outpacing the $46 million analyst consensus.
By contrast, Bookham Inc. (Nasdaq: BKHM; London: BHM) continues to struggle, most recently announcing it's going to undergo even more cuts as it completes the transfer of manufacturing to China. (See Bookham Trims Again.)
Analysts still expect Avanex to lose money -- 3 cents per share in non-GAAP terms for the fourth quarter, according to Reuters.
The optical sector got some hope in March, when stocks rose on the promise of healthy future demand driven by applications such as fiber-to-the-home buildouts. (See Smiles Abound at OFC/NFOEC.) It's been downhill since then, as the entire tech sector has slumped; Avanex is well down from its 52-week high of $3.50.
Avanex isn't alone in bringing late-summer cheer. Earlier this month, Cisco Systems Inc. (Nasdaq: CSCO) put in a upbeat fourth quarter revenue report and an uncharacteristically bullish outlook for its September quarter. (See Cisco Q4 Hits the Mark.)
Avanex was scheduled to announce its earnings yesterday, but the company said it's still wrestling with accounting matters as it transfers operations to contract manufacturers.
— Craig Matsumoto, Senior Editor, Light Reading