Laser-manufacturer IPG Photonics shares tanked on Tuesday after reporting disappointing second-quarter earnings before the bell.
Shares closed down 27 percent, making it the worst performer in the Standard and Poor's 500 index on Tuesday.
The company reported second-quarter earnings per share at $2.21, below a $2.25 consensus estimate by Thomson Reuters, despite growing 16 percent year over year. Revenue for the quarter came in at $413.6 million after taking a $8.4 million hit due to depreciation of the euro and Chinese yuan this year.
IPG Photonics CEO Valentin Gapontsev said that although the company benefited from the lower tax rate under the Tax Cuts and Jobs Act, escalating trade tensions between the U.S. and other global economic powers have taken a bite out of demand overseas.
"While orders grew slightly on a year over year basis, order flow was below our target as demand softened in Europe and China at the end of the quarter," Gapontsev said in a statement. "This more modest year over year growth in orders has persisted through July, and we believe is primarily driven by macroeconomic and geopolitical factors rather than competitive dynamics."
IPG Photonics develops and manufactures lasers and amplifiers for various markets, including for scientific, materials processing and entertainment fields.