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Shares of ScanSource (NASDAQ: SCSC) sank on Tuesday after the technology products distributor reported its fiscal fourth-quarter results. The numbers were mixed relative to analyst expectations, with sales down more than 20% due to the COVID-19 pandemic. ScanSource stock was down about 11.5% at 11:20 a.m. EDT.
ScanSource reported fourth-quarter revenue of $636.5 million, down 22% year over year and just barely ahead of the average analyst estimate. Organic sales were down 19%. The company saw lower demand from its customers due to the impact of the pandemic.
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One bright spot for ScanSource was Intelisys, which sells business telecommunications services. Revenue from Intelisys grew by 15% in the quarter.
Adjusted earnings per share came in at $0.19, down from $0.75 in the prior-year period and $0.02 below the average analyst estimate. The company lost $4.29 per share under generally accepted accounting principles (GAAP), largely due to goodwill and asset impairment charges driven by lower revenue projections.
ScanSource announced a $30 million expense reduction plan in July, which will help offset the revenue impacts of the pandemic. The company reduced its selling, general, and administrative expenses by about 7.5% in the fourth quarter.
The demand environment for ScanSource remains uncertain as the pandemic continues to play out in the United States. Including Tuesday's decline, the stock is down about 40% since the start of the year.
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Why ScanSource Stock Slumped Today was originally published by The Motley Fool