Calix, Inc. (CALX) will report Q1 earnings after the bell on May 1, 2012. On its last earnings call, CFO Michael Ashby provided Q1 guidance of $80 to $82 million in revenue and EPS 0.05, leaving room for upside relative to Wall Street estimates of $81.0 million and break-even EPS. Last year's Q1 came in at $71.5 million and $0.09, but only included a small contribution from its February 2011 acquisition of Occam.
Cutting through the clutter, management's Q1 guidance was meant to be bullish. Ashby stated that first quarter revenues have typically been down 20% versus Q4 over the past several years. That would lead one to expect just $73.3 million, versus the company's $80-82 million guidance.
This news suggests that demand is turning the corner. The company has been winning deals and increasing bookings. Both would intuitively help to accelerate revenues in 2012. Looking at the competition, ADTRAN (ADTN) provided positive commentary regarding Broadband Stimulus demand in early April. Similarly, Zhone's (ZHNE) last earnings call revealed "a strong increase in orders" leading to a "better than expected backlog driving optimism for 2012 and a much stronger second quarter."
However, ZHNE experienced some component sourcing issues that put a damper on Q1 results. CALX is a larger company, so it may have been able to use its size to procure a full allotment of parts. If so, it likely took advantage of increased Stimulus demand setting it up for a favorable result on Tuesday night.
Between the optimistic guidance and the component risk, we'd think twice before jumping in ahead of the call. Consensus estimates provide some breathing room versus guidance, but a component shortfall would likely require greater cushion to save the day.
Disclosure: I am long ZHNE.