Netscout Systems (NASDAQ: NTCT) reported Q1 EPS of $0.03, $0.02 better than the analyst estimate of $0.01. Revenue for the quarter came in at $205.1 million versus the consensus estimate of $210.48 million.

“We delivered a relatively solid first-quarter earnings performance primarily due to our ongoing efforts to carefully manage costs,” stated Anil Singhal, NETSCOUT’s president and chief executive officer. “Although enterprise order delays resulted in revenue at the lower end of our targets, we continued to make important progress advancing our ‘smart data’ product strategy. We plan to introduce several new security offerings over the next several months and are optimistic that these initiatives can help us further fortify and expand our enterprise customer relationships. Just as important, we also expect to take additional cost-reduction actions to further streamline operations and drive efficiencies while also continuing to fund our most promising growth initiatives.”

Guidance:

NETSCOUT’s fiscal year 2019 guidance, previously issued in May 2018, is fundamentally unchanged although the GAAP net income per share (diluted) guidance has been updated to reflect the previously mentioned, non-cash intangible asset impairment charge of $35.9 million that was incurred in the first quarter.

• The Company’s fiscal year 2019 GAAP revenue performance is still expected to range from a low single-digit decline to low single-digit growth on a percentage change basis from fiscal year 2018 GAAP revenue of $986.8 million. The Company’s fiscal year 2019 non-GAAP revenue performance is still expected to range from a low single-digit decline to low single-digit growth from fiscal year 2018 non-GAAP revenue of $999.3 million.
  • Under the legacy ASC 605 standard, the Company’s GAAP revenue guidance range would equate to low single-digit to mid single-digit revenue growth on a percentage change basis over fiscal year 2018 GAAP revenue. Under the legacy ASC 605 standard, the Company’s non-GAAP revenue guidance range would equate to roughly flat revenue with fiscal year 2018 non-GAAP revenue to low single-digit growth over fiscal year 2018 non-GAAP revenue on a percentage change basis.
• As a result of the aforementioned charge, the Company’s fiscal year 2019 GAAP net income per share (diluted) is now expected to decline within a range of 140 percent to 190 percent on a percentage change basis from fiscal year 2018 GAAP net income per share (diluted) of $0.90. The Company’s original fiscal year 2019 guidance for fiscal year 2019 GAAP net income per share (diluted) ranged from a decline within a range of 115 percent to 165 percent on a percentage basis from fiscal year 2018. The Company’s fiscal year 2019 non-GAAP net income per share (diluted) performance is still expected to range from a decline of approximately 20 percent to low double-digit growth over fiscal year 2018 non-GAAP net income per share (diluted) of $1.41.
  • Under the legacy ASC 605 standard, the Company’s GAAP net income per share (diluted) guidance would now equate to a decline in the range of 110 percent to 160 percent from fiscal year 2018’s net income per diluted share (diluted). The original guidance equated to a decline in GAAP net income per share (diluted) in the range of 90 percent to 140 percent from fiscal year 2018’s GAAP net income per share (diluted). Under the legacy ASC 605 standard, the non-GAAP net income per share (diluted) guidance would equate to a low single-digit decline from fiscal year 2018’s non-GAAP net income to approximately 30 percent growth over fiscal year 2018 on a percentage change basis.
• A reconciliation between GAAP and non-GAAP revenue and net income per share (diluted) for NETSCOUT’s guidance is included in the attached financial tables.

For earnings history and earnings-related data on Netscout Systems (NTCT) click here.