Acme Packet's stock takes hit on lower Q2 forecast

Acme Packet's (Nasdaq: APKT) shares declined almost 16 percent on Friday after the Session Border Controller (SBC) vendor revealed a lower than expected Q2 2012 financial forecast.

It said it expected to report Q2 profit of 12 to 13 cents per share and $66 million to $68 million in revenue, down from the $79.7 million it reported in the same period last year.

Analysts polled by Thomson Reuters I/B/E/S forecast earnings of 18 cents per share on revenue of $73.9 million.

The Bedford, Mass.-based vendor attributed the weaker forecast to slow North American sales from key customers including AT&T (NYSE: T), Verizon (NYSE: VZ) and Sprint (NYSE: S).

This news is another setback for the vendor, whose shares have tumbled over 80 percent since last April. In May, Acme Packet said it would see an uptick orders during the second half of this year.

While a recent Infonetics report indicated that the SBC market grew 60 percent in 2011, primarily due to an even bigger jump of 88 percent in the market for SIP (session initiation protocol), it is seeing increased competition from vendors like Cisco (Nasdaq: CSCO), GENBAND, Sonus (Nasdaq: SONS), and Alcatel-Lucent (NYSE: ALU), which are all expanding their own SBC portfolios.  

To break out of its doldrums, the vendor previously said that it would invest more heavily in both the enterprise and the wireless space. In Q1 2012, Acme Packet reported that its enterprise market share expanded to 34 percent, and that wireless operators' investment in VoLTE in 2013 will help drive new revenues.

Acme Packet shares were trading at $15.45, down $.29, in pre-market trading today on the Nasdaq. Shares continued their slide in mid-morning trading, to $15.04 at 10:00 a.m. EDT.

For more:
- Reuters has this article

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