What: Shares of Alere , a company focused on rapid diagnostic testing, were down more than 11% in early morning trading on much heavier than normal volume after the company reported its third-quarter earnings.
So what:Revenue for the quarter was $602 million, which was a 7.3% decrease from the year-ago period, though if you strip out currency effects sales were down a more modest 1.7%. Non-GAAP net income for the quarter was $48.3 million, or $0.54 per share.
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While the company did managed to meet expectations on the top-line, profits didn't follow suit and came up $0.07 below what analysts were looking for.
In addition, when you look at each individual business segment, the results do not get any prettier, as nearly every segment took a hit during the quarter.
For the full year, the company is now forecasting revenue to fall between$2.48 billion to $2.50 billion and for Non-GAAP earnings per share to land between $2.20 to $2.25. Both of those numbers are also a bit shy of the $2.57 billion and $2.42 per share, respectively, that the market is expecting.
The lower than hoped for third-quarter profit mixed with a disappointing outlook appear to be the primary causes of the shares decline today.
Now what:In the press release,Namal Nawana, Alere's CEO, stated:
Nawana did state that despite the challenges, he believes that there are reasons to be optimistic about the future. The company recently launched the Alere i, a device used to rapidly detect infectious diseases like influenza A & B, noting that the produced revenue of $5 million in the third quarter. In addition, if you look beyond its pain management products, overall Toxicology revenue would have grown by 6% during the third quarter.
While there certainly could be reasons to be hopeful here, I'm not the type of investor that likes to buy into a company with declining revenue, so until Alere shows it can move its top-line in the right direction I'm happy to take a pass.
The article Why Alere Inc Shares Are Rapidly Moving Lower originally appeared on Fool.com.
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