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Extreme Networks (NASDAQ:EXTR) releases its next round of earnings this Wednesday, January 27. Get the latest predictions in Benzinga's essential guide to the company's Q2 earnings report.
Net Income, Earnings, And Earnings Per Share
Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.
Earnings And Revenue
Sell-side analysts expect Extreme Networks's EPS to be near $0.11 on sales of $240.70 million. Extreme Networks earnings in the same period a year ago was $0.13 per share. Quarterly sales came in at $267.47 million.
Why Analyst Estimates And Earnings Surprises Are Important
Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.
If the company were to report earnings in line when it publishes results Wednesday, quarterly profit would be down 15.38%. Revenue would have fallen 10.01% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:
Shares of Extreme Networks were trading at $7.83 as of January 25. Over the last 52-week period, shares are up 23.46%. Given that these returns are generally positive, long-term shareholders are probably happy going into this earnings release.
Do not be surprised to see the stock move on comments made during its conference call. Extreme Networks is scheduled to hold the call at 08:00:00 ET and can be accessed here.
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