Finisar just has a lot going on, financially. There was a debt buyback in August, for instance.
The real kicker was the sale of the Network Tools business -- test gear for Fibre Channel devices -- to JDSU (Nasdaq: JDSU; Toronto: JDU). (See JDSU Deal Addresses Finisar's Debt.) Network Tools now gets pushed into the "discontinued operations" category, meaning it's not part of Finisar's reported revenues. Which means there's a bit of backing-out to do if you want to create comparisons to past quarters.
Finisar's first-quarter earnings, reported yesterday, managed to put things rather clearly, I thought. If I'm reading the charts right, here's how the breakdown went, for the optics portion only:
Table 1: Finisar: Optics Alone
|Net Income ($M)||2.9||-11.1||-483%|
|EPS ($, GAAP)||0.01||-0.02||-300%|
|Share Price ($)||1.18||1.02||-14%|
|Source: Finisar, Yahoo Finance. Figures exclude the Network Tools business sold to JDSU.|
But the $115.8 million doesn't include Optium, which hadn't been fully assimilated as of August 2008. Optium reported $47.2 million for the quarter ended Aug. 2, 2008, which means the combined Finisar/Optium had $158 million revenues in the year-ago quarter. If I'm doing all the math right.
Just to keep things interesting, Finisar also announced a 1-for-8 reverse stock split to come on Sept. 25. It's not a surprise; companies need to keep a stock price above $1 to keep the trading exchange happy and to attract institutional investors.
Finisar didn't mention that on the earnings call. Its stated reason for the reverse split is another common one, though: to make earnings-per-share growth more obvious by lowering the number of shares, CEO Jerry Rawls said.
He might have a point. At the current number of shares outstanding, Finisar's earnings-per-shares is as flat as Kansas.
Table 2: Finisar's EPS Crawl
Per Share (�)
|* Projected. All figures non-GAAP.
Source: Finisar; Reuters Research
— Craig Matsumoto, West Coast Editor, Light Reading