Verifone Systems Inc. (NYSE: PAY) reported its fiscal second-quarter financial results after the markets closed on Tuesday. The company said it had $0.47 in earnings per share (EPS) on $532.4 million in revenue, compared to consensus estimates that called for $0.53 in EPS on revenue of $527.7 million. In the same period of last year, the company posted EPS of $0.44 and $490 million in revenue.
In terms of the outlook for the fiscal third quarter, the company expects to have EPS of $0.40 and net revenues of $515 million. Consensus estimates call for $0.59 in EPS on $552.11 million in revenue for the coming quarter.
The company is currently conducting a disciplined strategic review to address underperforming businesses and reduce overall operating expense levels. In connection with these plans the company intends to reduce headcount and estimates that these activities in total will generate approximately $30 million of savings in 2017.
During the second quarter, Verifone had an operating cash flow of $51 million. On the books, its cash and cash equivalents totaled $156.6 million at the end of the quarter, compared to $208.9 million at the end of the previous fiscal year.
Paul Galant, CEO of Verifone, commented:
Q2 was a mixed quarter for Verifone as we grew our business, but experienced several difficult market dynamics. As a result, it is necessary for us to adjust for these risks and update our outlook for FY16 to $2.100 billion dollars of revenue and $1.85 of earnings per share. We are aggressively executing mitigating actions including a headcount restructuring and a review of underperforming businesses. At the same time, we remain committed to executing our strategy in a disciplined manner, and continue to make progress in bringing our next generation devices to market and launching our services platform.
Shares of Verifone were down about 29% at $19.98 on Wednesday, with a consensus analyst price target of $36.32 and a 52-week trading range of $19.71 to $37.06.