Cognex reports disappointing Q3 results, revamps sales organization
OCTOBER 18--Cognex Corp. (Natick, MA, USA; www.cognex.com) has reported lower-than-expected third-quarter revenue and forecasts fourth-quarter revenue below analysts' expectations, citing a soft market, project delays, and slowing spending by its customers. Shares of the company fell more than 8% to $24.50 in late electronic trade on Tuesday, after closing at $26.71 on the NASDAQ.
"I am disappointed in the level of business in the third quarter of 2006," Cognex chief executive officer Robert Shillman said in a statement. The machine-vision-system maker said net income in the latest third quarter fell 7% to $10.1 million, or $0.22 a share, from $10.9 million, or $0.22 a share in the year-ago quarter. Excluding stock option expense, earnings were $12.4 million, or $0.27 a share, in the latest quarter.
Analysts had forecast third-quarter earnings of $0.21 a share, including stock option expense, according to Reuters Estimates. Third-quarter revenue was $58 million, flat compared with $58.3 million in the comparable quarter last year. Analysts on average had expected revenue of $62.8 million for the latest quarter.
Cognex said it expects to earn $0.19 to $0.23 a share on revenue of $58 million to $61 million for the fourth quarter. Excluding stock-option expense of about $0.05 a share, it expects to earn $0.24 to $0.28 a share. For the quarter, analysts on average expect the company to earn $0.22 a share, excluding any exceptional item, on revenue of $64.8 million.
Shillman said fourth-quarter revenue growth, if any, is expected to be modest as capital investments by manufacturers in the semiconductor, electronics, automotive, and steel industries will be slow through the year's end.
In other news, the company has promoted Eric Ceyrolle to executive vice president of worldwide sales. Ceyrolle will be responsible for managing Cognex's direct sales organization, as well as all of its channel sales worldwide for the Modular Vision Systems Division, the largest division at Cognex. In his new role, Ceyrolle will report to James F. Hoffmaster, Cognex president and chief operating officer.
In addition, Cognex has appointed Brian Phillips vice president of sales for the Americas. Phillips has been with Cognex for 13 years. He most recently held the position of business unit manager in charge of Cognex's new expert sensors. Phillips will report directly to Ceyrolle.
Cognex also promoted Didier Lacroix to vice president of sales for Europe and Ettore Cucchetti to vice president of sales for Asia.