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NetScout’s stock drops after warning of revenue shortfall

Shares of NetScout Systems Inc. sank 3.4% in premarket trade Tuesday, after the digital transformation services company warned of a fiscal fourth-quarter revenue shortfall, citing a delay in the recognition of revenue on a large service assurance project at an unnamed international mobile operator. The company now expects revenue for the quarter ended in March of $235 million, compared with revenue of $235.2 million a year ago, and below the FactSet consensus of $249 million. The company said it was unable to make up for the revenue shortfall given a “difficult service provider capital spending environment.” Meanwhile, the company said it expects adjusted EPS for the quarter to be around the mid-point of its previous guidance of 59 cents to 64 cents, which surrounded the FactSet consensus of 61 cents. The stock has surged 15% over the past three months, while S&P 500 has gained 12%.

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