Tellabs Inc.'s (TLAB) third-quarter profit surged 93% as the
telecommunications-equipment maker reported higher transport and
services revenue, as well as improved margins.
However, the company also forecast fourth-quarter revenue of
$410 million to $430 million. Analysts polled by Thomson Reuters
expected $442 million on average.
Tellabs has seen its results improve of late, helped by rising
revenue from both its products and services. The company has
focused on growth products and innovating in growth markets, such
as mobile Internet. Last week, investment firm Auriga said it
believed the company will likely enjoy at least two more quarters
of upside related to 3G and 4G upgrades.
Tellabs posted a profit of $56.5 million, or 15 cents a share,
up from $29.3 million, or 7 cents a share, a year earlier. Analysts
most recently expected 14 cents.
Revenue increased 10% to $429.2 million. The company in July
projected $425 million to $435 million, a view that topped
analysts' then-estimates.
Gross margin jumped to 50.2% from 41.7% due to higher revenue
from transport and data products, which carry above-average
margins.
Revenue in Tellabs' broadband segment, its biggest, declined
3.4% while profit fell 2%. Its transport business saw revenue rise
33% while profit more than doubled.
Shares closed at $8.06 Monday and were inactive premarket. The
stock is up 42% this year.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com