Shares of American Superconductor (NASDAQ:AMSC) experienced a significant 24-hour plunge of 19.22% on Wednesday, following the release of its second-quarter financial results. The sharp decline came despite the company beating earnings estimates, as investors focused on a disappointing revenue performance.
American Superconductor reported adjusted earnings per share of $0.20, surpassing the analyst consensus estimate of $0.15 by 31.58%. However, the company's quarterly sales of $65.862 million fell short of the analyst consensus estimate of $67.850 million by 2.93%. While this represents a 20.91% increase in revenue compared to the same period last year, the failure to meet market expectations appears to have spooked investors.
The company's Q2 net income reached $4.75 million, marking its fifth consecutive profitable quarter. American Superconductor also reported a gross margin exceeding 30%, driven by strong demand in energy and military markets. Despite these positive indicators, the revenue miss seems to have overshadowed the earnings beat, leading to the steep sell-off in the stock. The market's reaction suggests that investors are particularly concerned about the company's top-line growth and its ability to meet future revenue targets in an increasingly competitive electrical components and equipment sector.
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