In light of its preliminary Q3 results from this morning, shares of communications technology and infrastructure company Sonus Networks (SONS 8.09, +0.52) trade about 6.8% higher as both earnings and revenues are now expected to come in ahead of previous guidance and market expectations.
Specifically, SONS now sees Q3 earnings per share between $0.25-0.26 (compared to prior $0.17-0.20) and revenues of $74.5 million (versus prior $70-72 million). The company also issued non-GAAP gross margin guidance of 75%.
Management noted the company had two customers that contributed 10% or more of total revenue in Q3: Verizon, which contributed roughly 16% of revenue, and AT&T, which contributed about 11% of revenue.
Taking into account the Q3 preliminary results, including the timing nature of some of the additional revenue recognized in Q3, SONS continues to expect full year results in line with the upper end of the guidance it originally provided on August 3, 2017. Thus, for FY17 management sees revenue flat versus $252.6 million last year on EPS of $0.26.
At the moment, the stock is rubbed up against multi-month highs this morning – dating back to May – but failed to clear that level. Right now, the stock trades about 31x forecasted FY17 earnings and recoups all of its October losses. Shares still hold about a 27% gain YTD.
Full Q3 results will be reported on October 30, before the open.