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ADTRAN Q3 Profit Declines; Beats View - Update

Tuesday, ADTRAN, Inc. (ADTN), a provider of networking and communications equipment, reported a decline in profit for the third quarter ended September 30, impacted by a decline in sales. The company's quarterly earnings, however, exceeded analysts' expectations, as the sales drop was not as worse as analysts' expected and costs declined year-over-year.

ADTRAN's net income declined to $21.58 million or $0.34 per share from $22.41 million or $0.35 per share for same period last year. On average, seventeen Analysts polled by Thomson-Reuters expected the company to report earnings of $0.32 per share for the third quarter. Analysts' estimates typically exclude one-time items.

Operating income declined to $28.96 million from $33.68 million for the prior year period. Cost of sales declined to $53.61 million from $55.51 million for the year-ago period. The Company noted that stock-based compensation expense reduced earnings per share by $0.02.

Sales declined to $128.06 million from $137.20 million a year earlier. Analysts expected revenues of $126.42 million.

ADTRAN Chief Executive Officer Tom Stanton said, "Broadband Access revenues grew 29% as we saw increasing acceptance of our Carrier Ethernet and Broadband services platforms. Optical Access revenues showed impressive strength growing 20% as carriers increased investment in wireless bandwidth upgrades. Internetworking revenues continued to expand as our success in this area continued to reflect the broad-based support we are seeing in our carrier distribution and value added reseller channels."

For the nine months, net income declined to $55.61 million or $0.88 per share from $61.87 million or $0.95 per share for the year earlier period. Revenues dropped to $359.95 million from $388.26 million for the same period last year.

ADTRAN's board declared a cash dividend of $0.09 per share which will be paid on November 12 for shareholders of record on October 29 and ex-divdend date is October 27.

Tuesday, ADTN closed at $25.25, up 4.43% on Nasdaq.

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