Arris Drops 15% After it Announces Lower Sales

| About: ARRIS International (ARRS)

Shares of cable modem supplier Arris Group (NASDAQ:ARRS) were down almost 15%, or $1.30, at $7.60, in after-hours trading Tuesday, after the company Tuesday evening announced a revised forecast for its second quarter that ended last month that was below analysts’ sales estimates. The company now sees sales of between $278 million and $280 million. That’s below an estimate of $288 million to $303 million, provided back on April 29, and short of analysts’ estimates for $294.8 million, according to Thomson Financial. Arris says it expects earnings per share at the low end of its previously forecast range of 13 cents to 17 cents, which is short of the Street’s 16-cent estimate. Arris’s press release says the company sees “maturing” (meaning, SLOW) demand for something called “EMTA,” a kind of cable moment designed with Internet calling features. At the same time, the company said that “bookings and backlog will be much improved as compared to the first quarter,” and that the company’s orders for its switching equipment, called “CMTS,” are “strong,” and that gross margins will be up versus the first quarter.

Arris shares had risen 23 cents, or 2.65%, during the regular session.