Cognex profits drop 48% in third quarter
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Cognex's Natick headquarters
Cognex Corp. stocks took a 3% hit in early trading on Tuesday as the company reported a continued decline in revenue due to substantially lower smartphone manufacturing sales and struggles with Chinese business.
The Natick machine vision systems and bar code reader manufacturer reported a year-over-year 21% decrease in revenue (to $183.3 million), a 48% decline in net income (to $41.7 million) in the third quarter and an earnings per diluted share of 23 cents for a 41% decline. This contributed to year-to-date declines of 9% in revenue and 29% in net income.
“Our Q3 results were in line with our guidance, with revenue at the top end of our expected range,” said Founder and Chairman of Cognex Robert Shillman, in a press release. “Even so, it is frustrating to report a decline in revenue, both year over year and sequentially, due to the ongoing slowdown in spending by customers in our two largest markets, consumer electronics and automotive.”
The company is predicting revenue for the fourth quarter of between $155 and $165 million. This would be the company’s lowest revenue quarter of the year and a decline from the previous year’s fourth quarter. This expected decline is due to a persistent deterioration of business conditions in the industrial markets the company serves, particularly in business that relates to China, according to the earnings report.
The company did highlight its recent $195-million acquisition of Korean software maker Sualab and the potential of fast-growing areas including logistics and deep learning.
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