Arris Shares Rise On Better-than-expected Q1 Results, Upbeat Outlook

(RTTNews) - Shares of Arris Group, Inc. (ARRS) gained almost 11 percent in extended trades Tuesday after the video and broadband equipment maker's preliminary financial results for the first quarter beat analysts' expectations and it forecast results for the second quarter above their estimates.

The company reported a turnaround to profit in the first quarter on revenues that more than tripled from last year.

Bob Stanzione, Chairman and CEO of Arris, said, "We had a strong first quarter achieving record revenue levels. As we had anticipated last quarter, 2014 is shaping up to be our best year so far. Continued product deployments, new product acceptances, and an expanding international interest will continue to drive overall improved performance."

In December 2012, Arris Group said it agreed to acquire Google Inc.'s (GOOG) Motorola Home business, TV set-top box maker, for $2.35 billion in a cash-and-stock deal. The company completed the acquisition of Motorola Home on April 17, 2013.

Georgia-based Arris' first-quarter net income was $40.80 million or $0.28 per share, compared to net loss of $14.65 million or $0.13 per share in the prior-year quarter.

Adjusted net income for the quarter was $0.47 per share, compared to $0.25 per share in the previous-year quarter. On average, nine analysts polled by Thomson Reuters expected the company to report earnings of $0.45 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter more than tripled to $1.23 billion from $353.65 million in the same period last year. Analysts had a consensus revenue estimate of $1.18 billion for the quarter.

Total operating expenses for the quarter rose to $308.79 million from $99.01 million in the same period last year and include a surge in research and development expenses as well as amortization of intangible assets.

Order backlog at the end of the quarter was $996.1 million, compared to $282.1 million at the end of the prior-year period.

Looking ahead to the second quarter, Arris forecast reported net income per share in a range of $0.27 to $0.33, adjusted net income per share in a range of $0.64 to $0.70, and revenues in a range of $1.41 billion to $1.45 billion. Analysts expect the company to report earnings of $0.50 per share for the quarter on revenue of $1.22 billion.

ARRS closed Tuesday's regular trading session at $25.72, down $0.63 or 2.39 percent on a volume of 1.95 million shares. However, in after-hours, the stock gained $2.79 or 10.85 percent to $28.51.