Boston, MA 08/12/2014 (wallstreetpr) – Voice and language solutions provider for businesses and consumers, Nuance Communications Inc. (NASDAQ:NUAN) witnessed a drop of 4.6 percentage points in operating margins during the third quarter that pulled down its profit also. The company expects to earn adjusted profit lower than the last year in the fourth quarter thus igniting a free-for-all fall of stock in the extended hours of trading on Monday.
Operating Margin
The company disclosed a 4.6 percentage fall in adjusted operating margin to 23.5% in the third quarter from 28.1% in the 2013-third quarter. It had resulted pulling down the profit of the company too.
Nuance Communications Inc. (NASDAQ:NUAN)’ CFO Tom Beaudoin said that its bookings and deferred revenue uptick were evident that the company was on the right track for a growth return. He also said that the results only reflected its continued progress made in important markets, a shift in recurring revenue streams apart from more focus on cost control.
Outlook
The company expects adjusted earnings of 24 – 29 cents a share for the fourth quarter and revenue of $500 – $520 million for the same period that ends in September. On average, Wall Street analysts were expecting the company to earn34 cents a share as profit and revenue of $540.49 million.
3Q Results
Nuance Communications Inc. (NASDAQ:NUAN) suffered a net loss of $54.2 million or a loss of 17 share in the third quarter compared to the net loss of $35 million or a loss of 11 cents a share in the year-ago quarter. On an adjusted basis, net income slipped to $87.6 million from $109.5 million and the earnings fell to 27 cents a share from 34 cents a share in the year earlier quarter. Street analysts estimated the company to earn 27 cents a share.
Nuance Communications’ total revenue rose 1.2% to $475.5 million from $469.8 million in the previous year quarter. Street analysts, on average, predicted the company to deliver revenue of $498.56 million.
The company indicated that total recurring revenue of 12% uptick accounted for 65% of its total revenue while on-demand revenue came in more than the licensing and product revenue for the first time.
