LeapFrog Enterprises (NYSE:LF) said late Thursday that its fourth-quarter profit edged above expectations, but the company offered a soft 2011 earnings forecast.
The Emeryville, Calif.-based company posted net income of $25.29 million, or 38 cents a share, compared with $29.4 million, or 46 cents a share, in the same quarter last year, ahead of average analyst estimates polled by Thomson Reuters of 36 cents.
Revenue for the maker of technology-based educational platforms was $190 million, up 1% from $189 million a year ago, missing the Street’s view of $192.67 million.
“As a result of our solid execution and diligent cost management, we achieved our first year of profitability in five years,” said LeapFrog CFO Mark Etnyre. “We have a strong balance sheet with no debt.”
The performance was driven by strong sales of Leapster Explorer, as well as broader retail distribution. The company’s mobile learning line however, was offset by declines in its interactive reading and learning toy lines during December.
Net sales in the U.S. slipped 2% to $152 million, from $156 million a year ago.
Margins improved slightly during the period, up to 45.2% from 44.2% in the fourth-quarter of 2009, fueled by a higher mix of software sales.
Looking ahead, the company said it expects net sales in 2011 to be flat to slightly down, as retail inventory levels ended higher in 2010 than the company had expected. For the full year, the company expects net income in the range of 15 cents to 20 cents a share, short of Wall Street estimates of 29 cents.