Cyberonics Inc.'s (CYBX) fiscal second-quarter earnings fell 50%
as the medical-device company was hurt by a lower tax benefit,
masking higher-than-expected revenue growth and a stronger margin
on price increases and higher production.
For the year, the company raised its operating income forecast
by $3 million to $45 million to $48 million and lifted its revenue
view to $187 million to $190 million from its increased August
outlook of $184 million to $188 million.
The maker of implantable pacemakerlike devices that treat
drug-resistant epilepsy has been trying to expand into depression
treatment and is exploring ways for its devices to detect and
potentially respond better to seizures. But it faces possible
competition from the larger Medtronic Inc. (MDT) and privately held
NeuroPace Inc.
For the quarter ended Oct. 29, Cyberonics reported a profit of
$24.9 million, or 88 cents a share, down from $50.1 million, or
$1.73 a share, a year earlier. Excluding tax benefits, earnings
fell to 25 cents from 33 cents while net sales jumped to $47.5
million from $40.7 million.
Analysts polled by Thomson Reuters most recently forecast
earnings of 25 cents a share on revenue of $46 million.
Operating margin rose to 26.9% from 22.3% on the price
increases.
U.S. sales, the vast majority of Cyberonics's business, grew
20%. International sales were up 3%, or double that excluding
currency fluctuations.
The U.S. epilepsy business saw 14% unit growth, and global
epilepsy sales grew more than 15% for the 12th straight
quarter.
Shares closed Friday at $27.20 and were inactive premarket. The
stock is up by a third this year.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com;