Shares of Stamps.com (NASDAQ: STMP) sank 49% in pre-market trading on Thursday after slashing its full-year outlook. However, the company posted first-quarter adjusted earnings and revenue that topped analysts’ estimates.
Higher service and customized postage revenues offset lower sales in product and insurance segments, pushing the company’s overall revenue up from the year-ago period. Stamps.com revised its full-year earnings guidance below Wall Street expectations.
Shares of Stamps.com fell almost 50% earlier this year after its executives announced possible termination of its exclusive deal with the U.S. postal service. The stock has lost more than 46% since the year began, while the S&P 500 has climbed 15.1%.
STMP Earnings & Outlook
Net income for the quarter ended March 31 fell to $15.8 million, or $0.87 per share from $47 million, or $2.54 per share in the year-ago period. Adjusted for one-time items, earnings came to $1.23 per share. Sales increased to $136 million from $133.6 million a year earlier. Analysts polled by Refinitiv had expected adjusted earnings of $1.07 per share on sales of $127.2 million.
Service revenues rose to $123.91 million from $120.92 million last year, while product revenue fell to $5.41 million from $5.68 million. Customized postage revenue increased to $3.36 million from $2.58 million, while insurance revenue declined to $3.33 million from $4.37 million in the year ago period.
Looking forward, Stamps.com now sees adjusted full year EPS of $3.35 to $4.85 from the previous guidance of $5.15 to $6.15. It expects full year revenue of between $510 million to $560 million from the prior guidance of between $540 million to $570 million.
Wall Street projects Stamps.com will come out with adjusted earnings of $1.20 per share on revenue of $132.4 million for the current quarter, and full year adjusted earnings of $5.42 per share on sales of $555 million.
Stamps.com CEO Comments
Stamps.com’s Chairman and Chief Executive Ken McBride commented, “During the first quarter we continued to make progress on our efforts to evolve our strategy to more fully embrace a global multi-carrier business model.”
“Our financial results for the first quarter were in-line with our expectations in light of our new strategic direction,” McBride added.
Stamps.com Inc Profile
Stamps.com Inc. is a leading provider of Internet-based mailing and shipping solutions in the United States and Europe. The company’s operating segments are Stamps.com and MetaPack.
The Stamps.com segment derives revenue from external customers from offering postage online and shipping software solutions offered to consumers, small businesses, e-commerce shippers, enterprise mailers, and high volume shippers.
The MetaPack segment consists of the operations of MetaPack which derives revenues from external customers from offering multi-carrier enterprise-level shipping software solutions to large e-commerce retailers and brands.