SAN JOSE, CA — (Marketwire) — 01/30/13 — Quantum Corp. (NYSE: QTM)
Quantum Corp. (NYSE: QTM), a proven global expert in data protection and big data management, today reported results for the third quarter of fiscal 2013 (FQ3-13), ended Dec. 31, 2012. Revenue for the quarter totaled $159 million, down 8 percent from the third quarter of fiscal 2012 (FQ3-12), primarily due to expected declines in OEM and branded tape automation revenue. However, total revenue was up $12 million, or 8 percent, over the prior quarter (FQ2-13). Quantum reported revenue of $41 million from disk system and software sales (including related service), a 13 percent increase over FQ3-12 due to record revenue from DXi® disk system sales. The company also grew tape automation revenue by 25 percent over the prior quarter, as both midrange and enterprise sales rebounded strongly.
Quantum reported a GAAP net loss of $8 million, or 4 cents per share, for FQ3-13, compared to GAAP net income of $4 million in the same quarter of last year. On a non-GAAP basis, the company had net income of $5 million, or 2 cents per share, down from net income of $12 million a year earlier. The year-over-year declines were largely driven by the lower overall revenue. Compared to the prior quarter-s results, the GAAP net loss in FQ3-13 was $4 million smaller, and the non-GAAP net income was $10 million higher.
“We improved our financial performance in the December quarter, growing revenue sequentially, driving better-than-expected non-GAAP profits and generating cash,” said Jon Gacek, president and CEO of Quantum. “We also had another quarter of record DXi deduplication sales, which contributed to the 14 percent year-over-year increase in combined DXi and StorNext® revenue we-ve achieved over the first three quarters of the fiscal year.
“In addition, even as we scaled back spending, we continued to invest in new, industry-leading products and solutions for protecting and managing digital content in physical, virtual, cloud and big data environments. These include our , , and .”
Quantum generated $6 million in cash from operating activities in FQ3-13 and ended the quarter with $55 million in cash and cash equivalents.
For the fourth quarter of fiscal 2013, Quantum expects:
Revenue of approximately $145 million to $150 million, reflecting typical seasonality, with higher sequential disk systems and software revenue.
GAAP gross margin rate of approximately 41 percent and non-GAAP gross margin rate of 42 percent.
GAAP operating expenses of $66 million to $68 million and non-GAAP operating expenses of $61 million to $63 million.
Interest expense of $2.5 million and taxes of $500,000.
Key business highlights for the December quarter include the following:
Quantum introduced a new family of wide area storage solutions, named Lattus, which provides globally distributed disk-based archives that are extremely scalable and cost-effective and allows storage of data forever on disk without interruption or migration. Integrating dispersed next-generation object storage and Quantum file system technologies, the Lattus family offers a new approach to archiving that overcomes the limitations and inefficiencies posed by traditional disk architectures in multi-petabyte storage environments. The first Lattus product, Lattus-X, began shipping in December.
The company integrated its Q-Cloud backup and disaster recovery services with Symantec OpenStorage (OST) technology, providing NetBackup and Backup Exec customers with multiple options for leveraging Q-Cloud-s services. Q-Cloud now directly supports NetBackup and Backup Exec software, enabling both backup applications to stay completely aware of all copies of data backed up to a Q-Cloud DXi appliance.
Quantum began offering full-featured, free downloads of its vmPRO virtual machine backup software and DXi V1000 virtual deduplication appliance, providing a risk-free way to explore their superior features and value. The vmPRO Standard Edition software protects up to 1 TB of virtual data and can be upgraded to vmPRO Enterprise Edition for additional capacity, making it easy for customers to adopt Quantum vmPRO and scale it to meet their growth requirements. The DXi V1000 stores up to 15 TB of deduplicated data and works with vmPRO software to offer a 100 percent virtual data protection solution as well as a path to the cloud.
LTO-6 technology started shipping in Quantum-s Scalar i6000 and i500 tape libraries, as well as in its autoloaders, drives and media. LTO-6 nearly doubles capacity and increases transfer rates by up to 43 percent over LTO-5 technology, further enhancing the role of tape as an integral component of a broader tiered storage strategy.
Quantum products continued to garner industry honors, as the DXi V1000 was named “Virtualisation Product of the Year” at the 2012 Storage, Virtualisation and Cloud Computing (SVC) Awards, and Quantum-s StorNext data management software was recognized as runner-up in the Storage Software Appliance category. In addition, earlier this month, Storage magazine announced that the DXi V1000 is a finalist for its 2012 Product of the Year awards, and Network Computing selected the DXi6701/02 midrange deduplication appliance as a Product of the Year finalist for its upcoming awards.
Quantum will hold a conference call today, Jan. 30, 2013, at 2:00 p.m. PST, to discuss its fiscal third quarter results. Press and industry analysts are invited to attend in listen-only mode. Dial-in number: (480) 629-9645 (U.S. & International). Quantum will provide a live audio webcast of the conference call beginning today, Jan. 30, 2013, at 2:00 p.m. PST. Site for the webcast and related information: .
Quantum is a proven global expert in data protection and big data management, providing specialized storage solutions for physical, virtual and cloud environments. From small businesses to major enterprises, more than 100,000 customers have trusted Quantum to help maximize the value of their data by protecting and preserving it over its entire lifecycle. With Quantum, customers can Be Certain they-re able to adapt in a changing world — keeping more data longer, bridging from today to tomorrow, and reducing costs. See how at .
Quantum, the Quantum logo, Be Certain, DXi, StorNext, Lattus, Scalar, Q-Cloud and Quantum vmPRO are either registered trademarks or trademarks of Quantum Corporation and its affiliates in the United States and/or other countries. All other trademarks are the property of their respective owners.
“Safe Harbor” Statement under the U.S. Private Securities Litigation Reform Act of 1995: This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Specifically, without limitation, all of our statements under the “Outlook” section are forward-looking statements within the meaning of the Safe Harbor. All forward-looking statements in this press release are based on information available to Quantum on the date hereof. These statements involve known and unknown risks, uncertainties and other factors that may cause Quantum-s actual results to differ materially from those implied by the forward-looking statement. More detailed information about these risk factors, and additional risk factors, are set forth in Quantum-s periodic filings with the Securities and Exchange Commission, including, but not limited to, those risks and uncertainties listed in the section entitled “Risk Factors” in Quantum-s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 14, 2012 and in Quantum-s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2012. Quantum expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Quantum believes that the non-GAAP financial measures disclosed above provide useful and supplemental information to investors regarding its quarterly financial performance. Quantum management uses these non-GAAP financial measures internally to understand, manage and evaluate the company-s business results and make operating decisions. For instance, Quantum management often makes decisions regarding staffing, future management priorities and how the company will direct future operating expenses on the basis of non-GAAP financial measures. In addition, compensation of our employees is based in part on the performance of our business based on non-GAAP operating income.
The non-GAAP financial measures used in this press release exclude the impact of acquisition expenses, amortization of intangibles, restructuring charges and share-based compensation expense for the following reasons:
Acquisition Expenses
The acquisition expenses were those expenses incurred to acquire Pancetera, Inc. and are not part of Quantum-s future core operations.
Amortization of Intangible Assets
This includes acquired intangibles such as purchased technology and customer relationships in connection with prior acquisitions. These expenses are not factored into management-s evaluation of potential acquisitions or Quantum-s performance after completion of the acquisitions because they are not related to Quantum-s core operating performance. In addition, the frequency and amount of such charges can vary significantly based on the size and timing of acquisitions and the maturities of the businesses being acquired. Excluding acquisition-related charges from non-GAAP measures provides investors with a basis to compare Quantum against the performance of other companies without the variability caused by purchase accounting.
Restructuring Charges
Restructuring charges primarily relate to expenses associated with changes to Quantum-s operating structure. Restructuring charges are excluded from non-GAAP financial measures because they are not considered core operating activities. Although Quantum has engaged in various restructuring activities in the past, each has been a discrete event based on a unique set of business objectives. Management believes that it is appropriate to exclude restructuring charges from Quantum-s non-GAAP financial measures, as it enhances the ability of investors to compare Quantum-s period-over-period operating results from continuing operations.
Share-Based Compensation Expense
Share-based compensation expense relates primarily to equity awards such as stock options and restricted stock units. Share-based compensation is a non-cash expense that varies in amount from period to period and is dependent on market forces that are often beyond Quantum-s control. As a result, management excludes this item from Quantum-s internal operating forecasts and models. Management believes that non-GAAP measures adjusted for share-based compensation provide investors with a basis to measure Quantum-s core performance against the performance of other companies without the variability created by share-based compensation as a result of the variety of equity awards used by other companies and the varying methodologies and assumptions used.
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. They are limited in value because they exclude charges that have a material impact on the company-s reported financial results and, therefore, should not be relied upon as the sole financial measures to evaluate the company. The non-GAAP financial measures are meant to supplement, and be viewed in conjunction with, GAAP financial measures. Investors are encouraged to review the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measures as provided in the tables accompanying this press release.
Brad Cohen
Public Relations
Quantum Corp.
(408) 944-4044
Christi Lee
Investor Relations
Quantum Corp.
(408) 944-4450
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