Continuing its recent trend of missing earnings estimates, FLIR Systems Inc. FLIR reported first-quarter 2016 adjusted earnings per share of 30 cents, lagging the Zacks Consensus Estimate of 32 cents by 6.3%. Earnings also compared unfavorably year over year, down almost 12%. Net income for the quarter came in at $1.1 million, compared with $47.9 million in the year-ago quarter. The massive decline was due to a significant tax reserve expense of $40 million. The company’s profitability was also hampered by an unfavorable product mix and higher manufacturing costs, which more than offset its robust top-line growth.Inside the HeadlinesThe company recorded impressive revenue growth, as the top line grew 10% year over year to $379.5 million, driven by robust performance across five of the company’s six segments. Softness in the Instruments segment, along with currency fluctuations limited the revenue growth to some extent.In constant currency terms, revenues were up 12% year over year. Also, the top line surpassed the Zacks Consensus Estimate of $358 million.As for the segments, Surveillance revenues returned to the growth track with a rise of 10% year over year to $124.2 million, while OEM & Emerging Markets revenues rose a whopping 20% over the prior-year period to $47.8 million.Security segment revenues continued to impress, as the top line grew 21% year over year to $47.1 million. Also, Detection revenues continued to drive overall top-line growth with robust momentum, increasing 61% year over year to $29.3 million.However, Maritime revenues witnessed some softness due to the adverse currency translation effect, and were up a meager 1% year over year to $51.7 million. On a constant currency basis, the segment recorded 5% growth.On the other hand, revenues from the Instruments segment was a dampener, as they declined 5% over the prior-year quarter to $79.4 million due to an unfavorable currency translation impact.FLIR's order backlog for the coming 12 months was about $613 million as of Mar 31, 2016, reflecting a solid year-over-year increase of 10%. This backlog level is the company’s highest since 2008, largely due to an impressive performance in FLIR Systems’ government businesses.Operating income came in at $57.4 million, compared with $65.8 million in the prior-year quarter. Higher production costs led to a decline in operating income.Liquidity & Cash FlowAs of Mar 31, 2016, the company's cash and cash equivalents were $510.6 million, compared with $472.8 million as of Mar 31, 2015. Long-term debt was $90 million, down from the year-ago figure of $93.8 million.Cash flow generated from operating activities in the quarter came in at $44.9 million, down significantly from $74.9 million in the prior-year quarter.GuidanceIncorporating the current market scenario, FLIR reiterated its guidance for 2016. The company expects revenues in the range of $1.6–$1.65 billion (representing growth of about 3–6% over 2015) and net earnings within $1.60–$1.70 per share (reflecting growth of roughly 3–9% over 2015).In addition, FLIR Systems expects its gross margins to expand in the second half of the year, as it undertakes operating cost control initiatives which will counteract near-term gross margin softness.To ConcludeFLIR Systems’ financial performance during the first quarter was largely positive, but high costs and currency fluctuations acted as major headwinds.The company’s strong focus on execution and reduction of operating costs drove its profitability. We believe strong growth in sales booking and record backlog levels signal bright prospects for the firm in the near future.FLIR Systems currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader sector include Spirit AeroSystems Holdings, Inc. SPR, Huntington Ingalls Industries, Inc. HII and B/E Aerospace Inc. BEAV. Each of these stocks hold a Zacks Rank #2 (Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPIRIT AEROSYS (SPR): Free Stock Analysis Report B/E AEROSPACE (BEAV): Free Stock Analysis Report FLIR SYSTEMS (FLIR): Free Stock Analysis Report HUNTINGTON INGL (HII): Free Stock Analysis Report To read this article on Zacks.com click here.