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What: Shares of ServiceSource International (NAS: SREV) plunged today by as much as 39% after the company reported earnings and weak guidance rattled investors.
So what: Third-quarter sales were $59.1 million, an 18% increase over last year. Non-GAAP net income was $1.9 million, or $0.02 per share. That bottom-line result was mildly worse than investors had hoped . CFO David Oppenheimer said the company had near-term challenges in converting ACV to revenue.
Now what: The fourth-quarter outlook was particularly weak, with revenue expected to be between $62 million and $64 million. That's far short of the $72 million in revenue that the Street thought was coming. The results triggered a handful of analyst downgrades, including from Morgan Stanley, CLSA, and Deutsche Bank. ServiceSource's near-term execution looks challenging.
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The article Why ServiceSource International Shares Plunged originally appeared on Fool.com.Evan Niu, CFA, and The Motley Fool have no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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