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iRobot Corporation (IRBT) Does Not Know Its Own Strength

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Just when you think you know what earnings season will bring, it seems like your favorite companies tend to throw you a curve ball.

Last month’s expectations…
Of course, this time you can’t blame iRobot Corporation (NASDAQ:IRBT) investors for being surprised; a little over a month ago, the robot maker’s stock rose 10% in a single day after the company raised its earnings guidance “based on strong quarterly results to date in both [its] Home Robot and Defense & Security business units.”

It's Time to Buy These 2 Defense StocksAll told, iRobot Corporation (NASDAQ:IRBT) said at the time it expected first-quarter revenue to come in between $102 million and $104 million, with earnings per share from $0.16 to $0.20 and adjusted EBITDA of $10 million to $12 million.

…meet today’s reality
As I noted at the time, last month’s revised guidance offered a much-needed reprieve for weary iRobot Corporation (NASDAQ:IRBT) shareholders following the two seemingly dismal quarterly reports that preceded it.

Then, Tuesday after the market close, iRobot Corporation (NASDAQ:IRBT) reported its official first-quarter numbers. As a result — and luckily for iRobot Corporation (NASDAQ:IRBT) investors who stuck around after last month’s pop — the stock is currently trading up around 15% as of this writing.

As it turns out, iRobot Corporation (NASDAQ:IRBT) managed to outperform even its own lofty expectations. First-quarter revenue rose 9% year over year to $106 million, and net income skyrocketed to $8.4 million, or $0.29 per diluted share. Even after including a one-time $0.08-per-share benefit from investment tax credits, that’s still a massive improvement over the meager $0.02 per share the company earned during the same three months in 2012.

A guiding light
Perhaps most exciting, however, is iRobot Corporation (NASDAQ:IRBT)’s strong guidance. Next quarter, the company now expects revenue between $128 million and $133 million, with earnings per share in the range of $0.15 to $0.20. Management also raised its full-year 2013 revenue guidance slightly and expects sales to come in between $485 million and $495 million, up from the previous range of $480 million to $490 million.

Even better, iRobot also raised its earnings expectations for the year, saying it should now earn between $0.80 and $1.00 per share. For those of you keeping track, that’s a boost of nearly 40% on both the top and bottom ranges of its previous 2013 EPS guidance of $0.57 to $0.72 per share.

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