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FireEye shares plummet after missed sales target and announced planned layoffs

FireEye information analysts work at the company's office in Milpitas, California.
Beck Diefenbach | Reuters

Shares of FireEye plummeted as much as 17 percent Friday after the company released quarterly earnings and announced planned layoffs.

The cybersecurity company posted a loss Thursday of 33 cents per share in the second quarter, beating analysts estimates for a loss of 39 cents per share. The company posted $175 million in revenue, missing analysts estimates of $182 million. Additionally, its current-quarter and full-year guidance was weaker than analysts had expected.

Earlier this week, the company's Board of Directors also approved layoffs of up to 400 of its 3,400 workers as a part of a restructuring plan, aimed to reduce annual expenses.

"Although total billings and revenue were below our expectations, efforts to optimize our cost structure resulted in a sequential decline in our costs and loss per share exceeded our expectations," Kevin Mandia, CEO of FireEye, said in a press release.

The executive added that he believes FireEye has competitive advantages "that will help re-invigorate" their growth and "deliver shareholder value in the future."

A Willilam Blair analyst downgraded FireEye Friday from "outperform" to "market perform," citing in part the challenges the company is going through will likely take multiple quarters to execute.

The analyst noted the biggest risk to their rating revision is that the company could be sold to a strategic buyer.

FireEye's stock has declined this year, falling nearly 29 percent.