Insights

Why Avaya Stock Is Falling Today

What happened 
Shares of Avaya Holdings (NYSE: AVYA), a cloud communications company, were tumbling this morning after the company reported worse-than-expected second-quarter results. 
The tech stock had fallen by 15.7% as of 11:16 a.m. ET. 
So what 
Avaya reported second-quarter non-GAAP (adjusted) earnings of $0.53 per share, which was down from $0.74 in the year-ago quarter and also below Wall Street’s consensus estimate of $0.61 per share. 
Image source: Getty Images.

The company’s revenue of $716 million in the quarter was down about 3% from the year-ago quarter and was far below analysts’ average estimate of $737.9 million. 
Avaya CEO Jim Chirico tried to highlight some of the good news for the company, including that it’s on track to hit annual recurring revenue of $1 billion by the end of 2022 for its OneCloud product.
“We are successfully repositioning the company from our historic one-time revenue model to a recurring one, in fact 75% of our new bookings were Avaya OneCloud,” Chirico said. 
Now what 
But investors weren’t happy with management’s guidance either. The company expected non-GAAP earnings for the full year to be between $2.09 to $2.25, but that was below Wall Street’s expectation of $2.80 for the full year. And Avaya’s full-year revenue outlook of between $2.81 billion and $2.85 billion was below analysts’ average estimate of $3 billion. 
Investors have grown increasingly concerned that high-growth technology stocks are riskier investments right now, as inflation hits a 40-year high. And as the Federal Reserve raises rates to try to get it under control, it’s likely that investor fears of a potential economic slowdown could cause more share price dips in the near term. 
Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. –

What happened 

Shares of Avaya Holdings (NYSE: AVYA), a cloud communications company, were tumbling this morning after the company reported worse-than-expected second-quarter results. 

The tech stock had fallen by 15.7% as of 11:16 a.m. ET. 

So what 

Avaya reported second-quarter non-GAAP (adjusted) earnings of $0.53 per share, which was down from $0.74 in the year-ago quarter and also below Wall Street’s consensus estimate of $0.61 per share. 

Image source: Getty Images.

The company’s revenue of $716 million in the quarter was down about 3% from the year-ago quarter and was far below analysts’ average estimate of $737.9 million. 

Avaya CEO Jim Chirico tried to highlight some of the good news for the company, including that it’s on track to hit annual recurring revenue of $1 billion by the end of 2022 for its OneCloud product.

“We are successfully repositioning the company from our historic one-time revenue model to a recurring one, in fact 75% of our new bookings were Avaya OneCloud,” Chirico said. 

Now what 

But investors weren’t happy with management’s guidance either. The company expected non-GAAP earnings for the full year to be between $2.09 to $2.25, but that was below Wall Street’s expectation of $2.80 for the full year. And Avaya’s full-year revenue outlook of between $2.81 billion and $2.85 billion was below analysts’ average estimate of $3 billion. 

Investors have grown increasingly concerned that high-growth technology stocks are riskier investments right now, as inflation hits a 40-year high. And as the Federal Reserve raises rates to try to get it under control, it’s likely that investor fears of a potential economic slowdown could cause more share price dips in the near term. 

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

  • This field is for validation purposes and should be left unchanged.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US & HK* Trades. Click Here!