Switch's Q1 Falls Short of Expectations
Switch Inc. (NYSE: SWCH) released its first-quarter financial results after the markets closed on Monday. The company said that it had $0.02 in earnings per share (EPS) on $97.7 million in revenue, while consensus estimates had called for $0.05 in EPS on revenue of $99.83 million. In the same period of last year, Switch said it had EPS of $0.10 and $89.16 million in revenue.
During this quarter, Switch announced a 15-megawatt colocation deal with an international streaming media corporation that plans to use Switch’s North American PRIME data centers as a worldwide distribution hub for its services. The company plans to go live at Switch’s facilities in Nevada in July of this year.
The board of directors declared a cash dividend of $0.0147 per share of Switch’s Class A common stock for the second quarter of 2018. The dividend will be payable on June 8, to all stockholders of record as of the close of business on May 29. Also, future declarations of quarterly dividends will be subject to the board’s determination.
Looking ahead to the 2018 full year, the company expects to see revenues in the range of $423 million to $440 million, with adjusted EBITDA of $216 million to $224 million. The consensus estimates call for $0.24 in EPS on $431.31 million in revenue for the year.
On the books, Switch’s cash and cash equivalents totaled $238.56 million at the end of the quarter, compared with $264.67 million at the end of the previous fiscal year.
Thomas Morton, president and general counsel of Switch, commented:
Our highly differentiated and strategically located campus ecosystems continue to attract primary deployments, while our unique telecom capabilities enable hybrid cloud environments and hyperscale cloud deployments with AWS Direct Connect, Microsoft Express Route, and Google Cloud Interconnect.
Shares of Switch closed Monday at $15.47, with a consensus analyst price target of $17.95 and a 52-week range of $13.10 to $24.90. Following the announcement, the stock was down about 8% in early trading indications Tuesday.