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ADC Telecommunications

(ADCT) - Get ADC Therapeutics Ltd Report

hit its fiscal third-quarter targets but offered not-so-solid guidance for the current quarter.

The Minneapolis networking-gear maker posted adjusted net income of 29 cents a share on $314 million in sales in the quarter ended July 29. Those results compare with a break-even performance on sales of $224.9 million in the year-ago quarter. Analysts were looking for a profit of 29 cents on $318 million in revenue, according to Reuters Research.

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Looking ahead, the company says telcos may have overspent their capital budgets in the first half of this year, and that makes a financial projection for the fiscal fourth quarter very difficult. ADC expects to book about 26 cents a share in unadjusted GAAP earnings on revenue of about $320 million in the current quarter.

That guidance is a bit below the 30-cent profit on $322 million in sales that Wall Street analysts were looking for.

For the fiscal fourth quarter, the company is expecting gross margins of around 38%-41%, that is up from the 36.8% the company had in the recent quarter.

"Our strong year-over-year performance in our third quarter was a result of an increase in sales of our broad family of communications infrastructure products and services, as well as improved operating margins," CEO Bob Switz said in a press release.

ADC shares fell $1.69, or 7%, to $21 in after-hours trading Tuesday.