Cogent (COGT) plunged 30% after the biometric identification company missed analysts' revenue estimates by more than half.
The South Pasadena, Calif., fingerprinter made $3.6 million, or 4 cents a share, down from the year-ago $14.4 million, or 16 cents a share. Revenue plunged to $13.2 million from $39.4 million a year earlier. Analysts surveyed by Thomson Financial were looking for a dime-a-share profit on sales of $28 million.
"Our lower second quarter revenues reflect lumpiness in our business, the timing of revenue recognition of contracts and the delay of projects from key existing customers," said CEO Ming Hsieh. "Last year, our two largest customers -- the Department of Homeland Security (DHS) and National Electoral Council of Venezuela (CNE) -- accounted for approximately $59 million in revenue during the first half of the year. In the same period this year, these two customers have accounted for approximately $14 million in revenue.
"Despite this drop, we believe our position with these two customers is very strong and are encouraged by the prospects for future growth in the coming years. Over the next 11 months, we will be recognizing $26 million in revenues from the CNE and have an additional revenue opportunity tied to national elections in the fourth quarter," he added. "Even more importantly, we expect the DHS to ramp up in the second half of 2006 and into 2007 based on existing orders and key projects coming on line."
The company also set plans to buy back as much as $30 million of stock.
Shares fell $4 late Wednesday to $9.70.