Photo: Toby Talbot/AP Images
Green Mountain Coffee Roasters, the owner of Keurig coffee machines and the coffee packs that fill them, reported in line quarterly results today, but slashed both its top and bottom line guidance as demand faltered.Click here for updates >
The company reported earnings per share of $0.64, in line with estimates, on sales of $885.1 million.
However, shares plunged more than 37 per cent after shares began trading at 4:20 p.m. on heavy volume.
Green Mountain has revised its full year estimates to $2.40 to $2.50 per share as K-Cup demand came in lower than the company anticipated.
“After several quarters of robust adoption, we now expect a more moderated growth trajectory going forward for both Keurig brewer and K-Cup pack sales,” Green Mountain Chief Executive Lawrence Blanford said.
Earlier this year, Green Mountain projected it would earn as much as $2.65 per share as it aggressively expanded operations.
The company also wrote down inventories held at the end of 2011 by more than $70 million.
Hedge fund magnate David Einhorn was one of the first investors to seriously question the company and its practices, saying that Green Mountain over produced both coffee and coffee machines.
That production, Einhorn said, led to spoilage problems and returns of the physical machines from retailers.
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