What Happened?
Shares of laser company nLIGHT (NASDAQ: LASR) jumped 23.4% in the afternoon session after the company reported better-than-expected second-quarter results and issued strong forward-looking guidance. The laser technology specialist reported revenue of $61.74 million, a 22.2% year-over-year increase that beat analyst estimates. Additionally, the company posted an adjusted profit of $0.06 per share, a significant turnaround from a loss of $0.10 per share in the same period last year and well above consensus estimates for a $0.09 loss. Looking ahead, the company issued upbeat third-quarter revenue guidance of $64.5 million, which was nearly 14% above analyst expectations. The company also provided optimistic full-year EBITDA guidance, expecting $4 million at the midpoint, which blew past analyst projections of a loss. Overall, it was a strong quarter that impressed investors with better-than-expected profitability and an optimistic outlook.
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What Is The Market Telling Us
nLIGHT’s shares are extremely volatile and have had 34 moves greater than 5% over the last year. But moves this big are rare even for nLIGHT and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock dropped 17.1% on the news that the company reported underwhelming preliminary fourth quarter results, with sales expected to fall below the previous guidance range. Precisely, LASR expects Q4 2024 revenues of $46 million to $48 million (vs. previous estimates of $49 million to $54 million). The company blamed the weakness on "continued weakness in our industrial markets, execution challenges in our microfabrication business, and the timing of the delivery of a limited number of defense products." Consequently, profit indicators, including gross margin and adjusted EBITDA, are also expected to fall significantly below previous estimates. Overall, the results aren't encouraging and indicate challenging times ahead.
nLIGHT is up 151% since the beginning of the year, and at $26.11 per share, has set a new 52-week high. Investors who bought $1,000 worth of nLIGHT’s shares 5 years ago would now be looking at an investment worth $1,078.
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