Isilon Reports Q3

SEATTLE -- Isilon Systems (Nasdaq: ISLN - News), the leader in clustered storage, today announced preliminary results for the third quarter of 2007 ended September 30, 2007. Based on preliminary estimates, total revenue is expected to be in the range of $23.2 million to $23.7 million, down approximately 6 percent to 8 percent sequentially from the second quarter of 2007 and up approximately 30 percent to 33 percent from the same period one year ago. Previously, on the company's second quarter conference call on July 26, 2007, the company stated it expected total revenue in the range of $25 million to $27.5 million for the third quarter of 2007.

Based on preliminary revenue estimates for the third quarter of 2007, Isilon expects GAAP gross margin to be in the range of 54.4 percent to 56.4 percent and non-GAAP(1) gross margin in the range of 54.6 percent to 56.6 percent. Based on preliminary revenue and gross margin estimates, Isilon expects GAAP net loss per share to be in the range of ($0.10) to ($0.12) and non-GAAP net loss per share to be in the range of ($0.08) to ($0.10). Isilon management will host a conference call today at 2:00 p.m. PT (5:00 p.m. ET) to discuss the preliminary results.

"We are disappointed with our Q3 results," said Steve Goldman, president and chief executive officer. "Despite the fact that our recent growth rate has not been matching our expectations, continued spending by an ever broadening range of new and existing customers underscores the strong value proposition of Isilon clustered storage."

Isilon Systems Inc.