Arris smashes investor forecast on Q2 revenue of $1.43B; video set-top/gateway sales spike 8%

Arris Group reported second-quarter revenue of $1.43 billion, up 43 percent year over year, driven by an 8 percent volume rise over Q1 in video set-top/gateway sales and an 11 percent volume rise over the first quarter in sales of broadband devices.

The Suwanee, Ga.-based technology company beat consensus revenue forecast of $1.4 billion, as well as adjusted-earnings-per-share predictions of 68 cents, coming in at 70 cents.

Arris attributed its strong sales of video set-tops to uptake of new products in Latin America, where DirecTV added 543,000 subscribers in Q2 alone. Arris also tied its performance to the launch of Verizon FiOS' Quantum TV service, which is based on the Arris Verizon Media server.

On the broadband side, Arris said it sold a record number DOCSIS- and DSL-capable devices.

Arris chairman and CEO Bob Stanzione said ongoing turbulence in the MSO world--i.e. the pending mergers of major operators and the launch of a new cable company, SpinCo--makes the always-hard-to-forecast third and fourth quarters even more difficult to predict. But the product refresh cycle makes him bullish on 2015.

"There's going to be a pretty robust demand cycle ahead of us as DOCSIS 2.0 [devices] get thrown away and 3.0 get put in...and as 3.0 boxes get thrown out and 3.1 get put in," Stanzione explained.

For more:
- see this Arris investor release
- see this Arris presentation (PDF)

Related links:
Arris teams with startup Wurl to create new OTT platform for set-tops
IHS: Global set-top revenue hit all-time high in 2013, will peak in 2015
Arris sales boosted by Comcast, Time Warner Cable demand for gateways

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