06:53 AM EDT, 07/10/2024 (MT Newswires) -- SMART Global's ( SGH ) fiscal third-quarter results declined on a yearly basis, but earnings came in ahead of the midpoint of its prior outlook amid lower operating expenses.

The manufacturer of computer memory chips and LEDs reported adjusted earnings of $0.37 per share for the three-month period ended May 31, down from $0.57 the year before, it said late Tuesday. Five analysts polled by Capital IQ expected $0.31. In April, the firm issued an outlook for adjusted EPS to be between $0.15 and $0.45 for the quarter.

Operating expenses fell to $77.4 million from $102.9 million in the prior-year quarter, "primarily due to lower variable expenses and cost reduction actions," Chief Operating Officer Jack Pacheco said during an earnings call, according to a Capital IQ transcript. Shares of the company gained 5.6% in Wednesday's premarket activity.

Sales slipped to $300.6 million from $344.4 million, while four analysts surveyed by Capital IQ estimated $301.6 million. Memory solutions revenue decreased to $91.6 million from $109.5 million, while intelligent platform solutions fell to nearly $145 million from $170.9 million. The LED solutions division logged sales of almost $64 million versus $64.1 million last year.

For the ongoing quarter, the company projects adjusted EPS of $0.40, plus or minus $0.15, and revenue of $325 million, plus or minus $25 million. Analysts are currently looking for normalized EPS of $0.41 and revenue $329.5 million.

"Our forecast for the fourth quarter of 2024 is based on the current environment, which contemplates the global macroeconomic headwinds and ongoing supply chain constraints," Pacheco told analysts. "We continue to manage our operations in a prudent manner as we navigate a challenging environment while also investing in our long-term growth."

The company forecasts sequential low-double-digit revenue growth at the midpoint for the intelligent platform solutions segment, while the memory business is expected to be up slightly in the low-single digits, according to Pacheco. For LED solutions, sales are expected to rise slightly in the low-single-digit range sequentially at the midpoint, the executive added.

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