Mercury Interactive (MERQE) expects third-quarter revenue below previous guidance due to large transaction delays and the company's continued transition in Europe.
The business software maker said after the bell Tuesday that it anticipates to post revenue of $198 million to $203 million in the quarter, down from prior expectations of $205 million to $215 million.
Mercury said it was holding off on earnings guidance because of a restatement. But the company said that excluding the restatement's effects, it would have expected earnings per share to be slightly below the low end of its prior range of 17 cents to 22 cents a share, and within the earnings-before-items range of 31 cents to 35 cents a share.
"The disappointing third-quarter results are due primarily to the delayed timing of several large transactions as well as our continued transition in Europe," said Amnon Landan, chairman and CEO. "We remain focused on improving execution and are cautious about the fourth quarter. We believe the actions initiated in the third quarter will position us to capitalize on our significant market opportunity and strong competitive position."
The company also reported that the previously disclosed informal inquiry by the
Securities and Exchange Commission
into the company's use of stock-based compensation has been converted to a formal investigation. The company believes that the focus of this formal investigation is substantially the same as the informal inquiry. Mercury has and will continue to cooperate with the SEC on the investigation, the company said.
Shares of Mercury Interactive closed Tuesday off 60 cents, or 1.6%, to $36.90.