FireEye, TripAdvisor Tank on Earnings as Activision Gains: Tech Winners & Losers

SAN FRANCISCO ( TheStreet) – Activision Blizzard (ATVI)  jumped Wednesday after the game publisher beat analysts estimates for the third quarter and raised its guidance for 2014.  FireEye (FEYE) and TripAdvisor (TRIP)  weren't as fortunate as investors pounded the stock following a weaker-than-expected performance and forecast.

Santa Monica, Calif.-based Activision, publisher of "World of Warcraft," gave investors an upside surprise when it posted adjusted earnings of 23 cents a share on adjusted revenue of $1.17 billion, surpassing the consensus estimate of 13 cents per share on revenue of $1.01 billion from analysts surveyed by Thomson Reuters.

Activision also bumped up its  full-year earnings forecast to $1.35 per share on revenue of $4.8 billion from its previous estimate of $1.29 earnings per share on revenue of $4.7 billion, according to Thomson Reuters. Investors who are interested in a detailed look into the quarter can check out Activision's earnings call transcripts here. Investors applauded the quarterly performance and better than expected forecast by pushing the shares up 4.4% to close at $20.83.


FireEye tanked 15% to close at $29.12 after the Milpitas, Calif., network security provider issued a weaker forecast for its fourth quarter and full year revenue. FireEye made the announcement during its earnings call Tuesday after the markets closed. 

The security software company said it expects fourth-quarter revenue of $135 million to $147 million, whereas Wall Street expected to see $144.2 million, according to analysts surveyed by Thomson Reuters. And for the full year, FireEye told investors to expect $418 million to $430 million in revenue. Analysts, however, were expecting $428.4 million.

A copy of the transcripts for FireEye's earnings call can be found here. Market observers warned investors should stay clear of FireEye and TripAdvisor, at least for now.


TripAdvisor plunged 14.1% to close at $71.95 after the Newton, Mass.-based travel advisory service got pummeled after it reported weaker than expected third quarter results on Tuesday after the markets closed. TripAdvisor reported earnings of 48 cents a share on a non-GAAP basis on revenue of $354 million. Wall Street, however, had been expecting 60 cents a share on revenue of $348.8 million, according to Thomson Reuters.

At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.


TheStreet Ratings team rates ACTIVISION BLIZZARD INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate ACTIVISION BLIZZARD INC (ATVI) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

You can view the full analysis from the report here: ATVI Ratings Report

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