What happened
Shares of Netgear (NTGR -3.07%) were tumbling today after the company reported its second-quarter 2021 results late yesterday. Investors appear to be disappointed with the company's sales and earnings from the quarter, as well as management's third-quarter guidance.
The tech stock was down by as much as 15% today and had dropped by 10.2% as of 11:48 a.m. EDT.
So what
Netgear reported sales of $308.8 million in the second quarter, an increase of just over 10% from the year-ago quarter. And the company's non-GAAP (adjusted) earnings of $0.66 per share were up from $0.54 per share in the year-ago quarter.
Image source: Getty Images.
But even though Netgear's earnings improved from a year ago, investors were disappointed that they missed analysts' consensus estimate of $0.71 per share.
Additionally, investors weren't happy with the company's third-quarter outlook. Netgear's management set revenue guidance between $285 million to $300 million, which represents a 20% decrease year over year, at the high end of guidance.
Comments about the upcoming quarter by Netgear's CFO, Bryan Murray, likely didn't boost investors' confidence, either:
"While we are confident in our ability to provide guidance at this time, we do so with the caveat that, while conditions are improving, considerable uncertainty remains in the market due to the COVID-19 pandemic and, should unforeseen events occur, in particular challenges related to closure of our manufacturing partners operations or transportation delays into any of our regional distribution centers, our actual results could differ from the foregoing guidance," Murray said.
Now what
Netgear's stock has not fared too well this year, even as the U.S. economy has begun to open back up. With today's share price drop the company's stock has slid more than 17% year to date.
With more uncertainty seemingly ahead for the company, it's no surprise that investors sold off some of their Netgear holdings today.
