Sanmina Profit Down, Outlook Weak; Shares Tank 11%

(RTTNews) - Sanmina Corp. (SANM) Monday reported a drop in profit for the second quarter despite modest growth in revenues, hurt largely by one-time items. Both earnings for the quarter and revenues fell short of Street expectations.

Moving ahead, the electronics contract manufacturer detailed a weak outlook for the third quarter, sending its shares plunging 11 percent in after-hours trade on the Nasdaq.

San Jose, California-based Sanmina's second-quarter profit dropped to $14.7 million or $0.17 per share from $20.8 million or $0.24 per share last year.

Excluding one-time items, adjusted earnings for the quarter improved to $0.50 per share from $0.44 per share a year ago. Nevertheless, it was short of nine analysts' consensus estimate of $0.53 per share for the quarter. Analysts' estimates typically exclude special items.

Sanmina's second-quarter revenues rose to $1.53 billion from $1.48 billion a year ago. Analysts had a consensus revenue estimate of $1.60 billion for the quarter.

"I am pleased with our profitability and cash generation in an environment where we had unexpectedly soft revenue. Our third quarter outlook reflects continued headwind in our communications networks segment offset by growth in the industrial, medical and defense segment," said CEO Jure Sola.

For the third quarter, the company expects adjusted earnings of $0.48 to $0.52 per share on revenues of $1.50 billion to $1.55 billion. Analysts currently expect earnings of $0.56 per share on revenues of $1.64 billion.

SANM closed Monday's regular trading at $23.36, up $0.22 or 0.95%. The stock, however, dropped $2.61 or 11.17% in the after-hours trade.