Shares of ChampionX fell after the company forecast lower fourth-quarter revenue than analysts had expected and missed the market consensus on third-quarter earnings.
ChampionX, a provider of chemistry programs and services for the upstream oil-and-gas industry, saw its stock decline by 11% in early trading, currently standing at $29.96. Despite this setback, shares are still up by 3% year-to-date.
Q4 Revenue Forecast Disappoints Analysts
The company's latest financial forecast reveals expectations of recording between $930 million and $970 million in revenue for the fourth quarter, falling short of the $1 billion projected by analysts polled by FactSet.
Factors Influencing Q4 Performance
CEO Sivasankaran Somasundaram attributes the anticipated decline in North American business to seasonal factors surrounding the upcoming holidays. However, the positive momentum observed in international and offshore operations is expected to offset this decline.
Q3 Earnings Below Expectations
ChampionX reported a profit of $77.7 million, equivalent to 39 cents per share, for the third quarter. This marks a decrease from the previous year's third-quarter profit of $95.8 million, or 48 cents per share. Adjusted earnings, excluding one-time items, were reported at 41 cents per share. Analysts previously surveyed by FactSet had projected adjusted earnings of 49 cents per share.
Revenue Performance in Q3
While revenue rose to $939.8 million from $926.6 million in the same quarter last year, it fell short of analyst projections for $966.8 million, according to FactSet data.