Why AudioCodes Stock Blasted Higher on Tuesday

What happened

Investors were very pleased to hear from AudioCodes (NASDAQ:AUDC) on Tuesday. The company, which concentrates on voice services and solutions for enterprises, delivered quarterly results that showed encouraging sequential -- if not necessarily year-over-year -- improvements in key metrics. As a result, its share price closed the day almost 16% higher.

So what

On the top line for its second quarter, AudioCodes earned $60 million in revenue. It didn't hesitate to mention that this was a more than 1% improvement over the first-quarter result. That wasn't the case on a year-over-year basis, though; in its second quarter of 2022, the company booked nearly $68.4 million.

As for profitability, the dynamic was the same. Non-GAAP (adjusted) net income of $5.1 million ($0.16 per share) nearly doubled when compared to the first quarter. Yet it was down from the year-ago quarter's $11.3 million profit.

Then again, AudioCodes did much better on the bottom line than analysts were collectively predicting. On average, they were modeling an adjusted per-share net income figure of $0.10 for the quarter just passed. Their average revenue estimate was almost exactly on the money, at $60.25 million.

In the earnings release, AudioCodes attributed its performance to good execution in its customer experience and conversational artificial intelligence businesses. Together, sales of these services rose by 7% year over year.

Now what

What also helped improve investor sentiment was a pair of shareholder-pleasing moves announced by AudioCodes. The company declared a fresh semi-annual dividend of $0.18 per share, which is to be doled out on Aug. 31 to stockholders of record as of Aug. 17. It also revealed that it had received authorization from a court in Israel to add $25 million in purchases to its share buyback program.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.