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What: Shares of Acacia Communications (NASDAQ: ACIA) soared on Friday following the release of the company's second-quarter report. Revenue more than doubled year over year, driving the stock 33% higher by noon.
So what: Acacia reported second-quarter revenue of $116.2 million, up 101% year over year. Costs soared as well, but higher revenue drove non-GAAP EPS to $0.77, up from $0.44 during the prior-year period. On a GAAP basis, Acacia reported earnings of $0.43 per share, up from $0.09 per share during the same period last year.
Acacia CEO Raj Shanmugaraj summed up the quarter:
Now what: Acacia expects to continue to grow rapidly during the third quarter. The company guided for third-quarter revenue in the range of $120 million to $128 million, with non-GAAP EPS between $0.64 and $0.76.
Acacia had its IPO in May, raising over $100 million and bolstering the company's balance sheet. Unlike many fast-growing technology companies, Acacia is profitable, with an impressive GAAP operating margin of 17% during the second quarter. While the stock is certainly priced optimistically, Acacia has the growth and the profitability to back it up.
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Timothy Green has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.