The Rural Utilities Service's (RUS) decision to extend the deadline to complete broadband stimulus-related projects had the unfortunate effect of eating into Calix's (NYSE: CALX) third quarter 2011 results.
Earlier this week, Rural Utilities Service (RUS) extended the completion deadline of broadband projects to the fall of 2015 in the hope that more grant winners will be able to return their funding paperwork so they can get their money.
Combined with fiber shortage in some parts of the market and a challenging economic environment, the deadline extension could continue to be a drag on Calix into Q4 and beyond.
"I'm concerned many [projects] will drag out to that date, and it could be a higher percentage than not," said Carl Russo, CEO and President of Calix, during the earnings call.
Calix reported that Q3 2011 revenue was $83.7 million, an 11 percent increase over $75.5 million in Q3 2010.
In late September, Calix reported preliminary revenue results of $83 and $85 million and non-GAAP earnings per share of $0.07 to $0.09 per share. This was lower than the company's earlier forecast of 20 cents a share adjusted profit on revenue of $104 million.
- see the earnings release
Earnings summary: Wireline in the third quarter 2011
Calix's Q3 2011 outlook suffers due to broadband stimulus project delays
For broadband stimulus winners, time is money as RUS extends deadlines
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Calix's Q2 revenue climbs 36.7% to $98 million