Cognex reports muted first quarter results due to increased expenses

Cognex (CGNX) reported a 22% jump in revenues of $169.5 million in the first quarter, in line with the guidance range provided by the firm last quarter. The first quarter revenue was aided by strong product demand globally, offset by lower sales from consumer electronics. It’s worth noting that the consumer electronics sector turned out to be one of the money spinners to Cognex.

Adjusted earnings of $0.18 per share remained flat compared to last year. The company failed to beat the analyst estimates, both on the revenue and earnings front.

Profit, excluding income tax, decreased 3.2% to $38 million due to increase in expenses, offset marginally by investment-related income. On the expense front, Research, Development & Engineering expenses spiked 36% due to increased product development costs, while Cognex saw 37% jump in SG&A expenses due to higher labor costs.

For the second quarter, Cognex expects its sales to come in the range of $200 million to $210 million, up 12-18% over the prior-year period. Gross margin is projected to be in the mid-70% range, while operating expense is expected to stay flat.

Cognex has declared a dividend of $0.045 per share with a record date of May 18. Share price has dropped 15% after extended hours of trading and is down nearly 25% this year.