SMART Global Holdings, Inc. (NASDAQ:SGH) shares were trading more than 22% lower Thursday afternoon following the company’s reported Q3 results. While both EPS of $0.87 and revenue of $463 million came in better than the Street estimates of $0.75 and $455.17 million, respectively, guidance missed expectations.
For Q4/2022, the company expects EPS in the range of $0.55-$0.75, compared to the consensus of $0.84, and revenue in the range of $420-460 million, compared to the consensus of $488 million.
Management remains confident with demand trends in the Intelligent Platform Solutions (IPS) business over the next few quarters, citing a current backlog of approximately $500 million. In addition, the company announced the acquisition of Stratus Technologies which should bolster its IPS portfolio, with a substantial portion of its revenue being recurring and high-margin services revenue.