VeriFone Falls as Quarterly Revenue Misses Estimates

VeriFone Systems Inc. (PAY) tumbled after the maker of credit-card terminals reported third-quarter sales that fell short of analysts’ estimates, citing unfavorable currency swings, competition in Europe and a fire in Brazil.

The shares of San Jose, California-based VeriFone dropped 14 percent to $30.55 at the close in New York, the biggest decline since May. The stock has fallen 14 percent this year.

Revenue in the quarter rose 54 percent from a year earlier to $489.1 million, VeriFone said yesterday in a statement. That missed the average $498.7 million estimate, according to data compiled by Bloomberg. One reason for the shortfall was a July fire that destroyed the company’s Brazilian staging-and-repair center, causing some VeriFone customers to turn to rivals. VeriFone also faced competitive pressure in France and Germany.

“The revenue was a little low in the quarter, and guidance for the next quarter and the next year was lower,” said Gil Luria, an analyst at Wedbush Securities Inc., in an interview yesterday.

Net income rose 43 percent to $37.7 million, or 34 cents a share, from $26.3 million, or 28 cents, a year earlier. Profit excluding some items was 75 cents a share, topping the average 70 cent estimate.

VeriFone forecast fourth-quarter earnings excluding certain items of 75 cents to 77 cents a share. For the fiscal year ending in October 2013, profit excluding some items will be $3.25 a share to $3.30 a share. Sales in fiscal 2013 will be $2.05 billion to $2.10 billion, less than the average $2.16 billion estimate.

To contact the reporter on this story: Olga Kharif in Portland at okharif@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.