Adtran sees weak third quarter revenue; shares plunge
(Reuters) - Network gear maker Adtran Inc (ADTN.O) said it expects the slowing economy to hurt third-quarter revenue, sending its shares down to a two-year low.
The company, which reported lower-than-expected second-quarter revenue on Tuesday, said it expects third-quarter revenue to be flat to slightly up on a sequential basis.
"During the quarter it has become apparent that customer sentiment in the current environment from an economic and regulatory perspective has deteriorated," a company executive said on a post-earnings call on Wednesday.
Analysts are expecting Adtran to report third-quarter revenue of $221.6 million, according to Thomson Reuters I/B/E/S.
The company also expects third-quarter gross margins to be flat on a sequential basis.
Network gear makers have been facing slowing demand for their products as telecom carrier customers cut spending amid a sluggish U.S. economy and weakness in Europe.
Adtran's rivals include Alcatel-Lucent SA (ALU.N), Cisco Systems Inc (CSCO.O), Ciena Corp (CIEN.O) and Juniper Networks Inc (JNPR.N).
Adtran, which counts Qwest Communications, AT&T (T.N) and Verizon (VZ.N) among its customers, on Tuesday reported second-quarter adjusted earnings of 38 cents per share, on revenue of $184 million.
Analysts expected adjusted earnings of 35 cents per share on revenue of $190.3 million for the second quarter.
Shares of Adtran, which has lost a third of its value in the last year, were down 16 percent at $22.95 in midday trade on the Nasdaq.
(Reporting by Siddharth Cavale and Shubham Singhal in Bangalore; Editing by Joyjeet Das and Supriya Kurane)
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