SUBSCRIBE TO OUR NEWSLETTER
Stay informed! Sign up to get expert advice and insight delivered direct to your inbox
Network Engines Posts Results
Network Engines reported financial results for its fiscal second quarter ended March 31, 2007
May 3, 2007
3 Min Read
CANTON, Mass. -- Network Engines, Inc. (NASDAQ: NENG), a leading provider of storage and security server appliance products and services, today reported financial results for its fiscal second quarter ended March 31, 2007.
Second Quarter Financial Performance
Net revenues of $29.3 million, above guidance of $25 million to $28 million and compared to $28 million in the fiscal second quarter of 2006.
Gross profit of 20.8 percent of net revenues, above guidance of 18 to 19 percent and compared to 15.4 percent in the fiscal second quarter of 2006.
Operating expenses of $6.2 million, including $608,000 of stock-based compensation expense, at the low end of guidance of $6.2 to $6.5 million. Operating expenses for the fiscal second quarter of 2006 were $7.2 million including $742,000 of stock-based compensation expense.
Net income on a GAAP basis was $365,000 or $0.01 per share, including $648,000 in stock-based compensation expenses, better than the guided range of a net loss of $(800,000) to $(1.1) million on a GAAP basis. Net income on a GAAP basis compared to a net loss of $(2.5) million, or $(0.06) per share, in the second fiscal quarter of 2006.
Non-GAAP net income, which excludes the stock-based compensation expenses, was $1.0 million or $0.02 per share, exceeding guidance of a net loss of $(200,000) to $(500,000) on a non-GAAP basis. Non-GAAP net income compared to a non-GAAP net loss of $(1.7) million, or $(0.04) per share, in the second fiscal quarter of 2006.
Cash, cash equivalents and short-term investments totaled $38.7 million at the close of the quarter, compared to $38.9 million at the end of December 2006 and above guidance of $36 million to $38 million.
Sales to EMC comprised 80% of total revenues during the second quarter of fiscal 2007, as compared to 79% from the year-ago quarter, with revenues from other customers totaling $5.8 million in the 2007 quarter compared to $5.9 million in the year-ago quarter. Revenues from Network Intelligence are now being included under EMC revenue since its September 18, 2006 acquisition by EMC. Excluding Network Intelligence revenues for the year-ago quarter, other revenues grew 57% during the second quarter of fiscal 2007. This growth was attributable to a ramp in revenue from existing customers, revenue for servicing Microsoft Whale customers, and revenue from new customer wins in the first half of fiscal 2007.
Network Engines reported solid financial results for the quarter and we continued to make steady progress on our overall strategy,” commented Greg Shortell, President and Chief Executive Officer of Network Engines. “We continued to make year-over-year improvement in profitability and this quarter recorded our first GAAP profit since 2004, with revenue growth supported by both existing and new customers. During the past quarters we have made many important changes to our business that has brought us closer to profitability, and while this quarter marks a significant milestone we remain dedicated to new customer acquisition, revenue diversification and expense management to reach a level where we are achieving consistent revenue growth and sustained profitability.”
Network Engines Inc.
Read more about:
2007You May Also Like
More Insights
