Finisar Corporation reported unaudited consolidated earnings results for the quarter and nine months ended January 28, 2018. For the quarter, the company reported Revenue was $332,403,000 against $380,588,000 a year ago. Loss from operations was $6,129,000 against profit of $54,906,000 a year ago. Loss before income taxes was $11,785,000 against profit of $50,886,000 a year ago. Net loss was $55,659,000 against profit of $46,387,000 a year ago. Diluted loss per share was $0.49 against earnings of $0.40 a year ago. Income before income taxes - non-GAAP was $25,801,000 against $71,304,000 a year ago. Net income - non-GAAP was $22,801,000 against $67,204,000 a year ago. Non-GAAP earnings per share were $0.20 per share against $0.59 per share a year ago. Capital expenditures excluding Sherman taxes were approximately $38.6 million from the third quarter. Non-GAAP operating income was $22.7 million compared to $70.4 million reported last year.

For the nine months, the company reported Revenue was $1,006,414,000 against $1,091,776,000 a year ago. Income from operations was $33,250,000 against $136,045,000 a year ago. Profit before income taxes was $15,053,000 against $128,497,000 a year ago. Net loss was $29,943,000 against profit of $119,101,000 a year ago. Diluted loss per share was $0.26 against earnings of $1.05 a year ago. Income before income taxes - non-GAAP was $102,490,000 against $183,883,000 a year ago Net income - non-GAAP was $94,640,000 against $174,183,000 a year ago. Non-GAAP earnings per share were $0.81 per share against $1.53 per share a year ago. Non-GAAP operating income was $94.6 million compared to $182.1 million reported last year.

The company indicated that for the fourth quarter of fiscal 2018 it currently expects revenues in the range of $300 to $320 million, non-GAAP gross margin of approximately 27%-28%, non-GAAP operating margin of approximately 4%, and non-GAAP earnings per fully diluted share in the range of approximately $0.09 to $0.15. The expected decline in revenues compared to the prior quarter is driven primarily by lower demand for VCSEL arrays, lower revenues from 40-gig datacom transceivers and lower telecom revenue, driven primarily by the full 3-month impact of the telecom price reductions that Kurt spoke to earlier. Non-GAAP tax rate for the fiscal fourth quarter is expected to be approximately 11%. Capital expenditures, excluding Sherman, for the fourth quarter are estimated to be $45 million, of which approximately $8 million is related to the construction and fit out of the third Wuxi manufacturing building. In addition, for Sherman, for the uplift of the building and additional equipment, the company expects capital expenditures of approximately $55 million in the fourth quarter.

The non-GAAP tax rate for fiscal 2019 is expected to be approximately 11% to 13%.

For the quarter, the company reported impairment of long-lived assets of $1,353,000.