The past few quarters have been tough for Itron (ITRI) and Silver Spring Networks (SSNI), two U.S. smart metering leaders seeking to expand the scope of their business amidst a broader slowdown in smart meter orders. This week saw both companies report second-quarter earnings with better news -- or in the case of Silver Spring, news that’s not as bad as expected.
Silver Spring Networks
Silver Spring reported a first-quarter loss of 20 cents per share on revenue of $63.6 million, down 26.5 percent from the same quarter last year. Still, the Redwood City, Calif.-based company beat analyst expectations of a loss of 23 cents per share for the quarter. Silver Spring shares fell in Thursday trading on the New York Stock Exchange to flirt with their 52-week low of $9.75 per share, down roughly 12 percent from the previous day.
In February, Silver Spring reported fiscal year 2014 revenues that failed to meet its annual growth projections, a slip the company blamed on delays in some large smart meter and grid networking contracts. Since then it’s expanded its networked streetlighting and “smart city” projects in Europe and the U.S., and this week it landed a partnership with Singapore-based smart meter maker EDMI with an eye on expanding to broader Asian markets.
Silver Spring also delivered some measures of its growth in areas outside its core smart meter networking business, including demand response and customer engagement, distribution automation networking, smart streetlights, and its SilverLink Sensor Network deployments. So-called “new solution” revenue added up to $11.9 million in non-GAAP terms, up 16 percent from the same quarter last year. Managed service and SaaS revenues also grew in non-GAAP terms, to $10.4 million, up 12 percent from the same quarter last year.
Itron’s second-quarter 2014 earnings report also beat analyst expectations. On Tuesday, the Liberty Lake, Wash.-based company reported revenues of $489 million, compared to an analyst consensus of $465.6 million, and earnings per share of 54 cents, compared to a consensus estimate of 36 cents per share. Itron shares rose from $36.40 to as high as $40.80 in Wednesday trading, and were trading at $39.50 as of Thursday afternoon.
In February, Itron reduced its 2014 guidance and committed itself to stripping out poorly performing technology lines in its electrical metering business, which has seen revenue shrink while the company’s natural gas and water metering business has grown. Since then it’s landed some big new customers, including a foothold in Duke Energy’s multi-state smart meter rollout plans.
While Itron’s second-quarter electricity segment revenues were still down from the same quarter last year, CEO Philip Mezey cited progress on its long-term plan to improve the unit’s performance, “which will be a key driver of long-term company profitability.” That includes its plans to embed more intelligence in its meters and link them to solar inverters, EV chargers and other grid-edge devices, as well as its ongoing partnership with Cisco.
U.S. demand response leader EnerNOC (ENOC) also beat analyst expectations in its Thursday second-quarter earnings report, with revenue of $44 million, up 22 percent from the same quarter last year, and a lower-than-expected loss of 74 cents per share. The Boston-based company reports its most significant revenues in the second half of its fiscal year, making this quarter’s results less significant as a measure of the company’s financial growth. EnerNOC shares were up slightly to $18.50 as of the close of Thursday trading.
CEO Tim Healy said in a statement that EnerNOC has grown its enterprise energy management services and international operations, building on some key acquisitions in Europe earlier this year. EnerNOC has also been diversifying into new areas, with its February investment in Genability, a solar/efficiency analysis software startup, and its purchase of utility bill management software provider EnTech in April.