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Last Update: 28-Dec-11 09:44 ET
Cavium Networks Recovers, But Still Down Modestly After Lowering Guidance Late Yesterday
Cavium Networks (CAVM 28.33 -0.15) is trading lower this morning, but has recovered about 2 pts., after lowering its fourth quarter guidance below consensus after the close yesterday.
Late yesterday, the company lowered its fourth quarter revenue guidance to $56 million to $57 million from $60.9 million to $62.3 million (-8 to -10% QoQ) versus $61.68 million Capital IQ Consensus Estimate.
The company noted that revenues have been weaker than expected across both the enterprise and service provider as well as the broadband and consumer market segments, and further exasperated by a larger than expected impact of a hub transition at one of its major customers. The co believes that it under shipped to customer end demand in Q4. Gross margins for Q4 are expected to be ~one percentage point lower than the co's previous guidance, due to the lower sales volume.
Late yesterday, the company lowered its fourth quarter revenue guidance to $56 million to $57 million from $60.9 million to $62.3 million (-8 to -10% QoQ) versus $61.68 million Capital IQ Consensus Estimate.
The company noted that revenues have been weaker than expected across both the enterprise and service provider as well as the broadband and consumer market segments, and further exasperated by a larger than expected impact of a hub transition at one of its major customers. The co believes that it under shipped to customer end demand in Q4. Gross margins for Q4 are expected to be ~one percentage point lower than the co's previous guidance, due to the lower sales volume.
