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Brocade Delivers Record Fiscal Q4 and 2009 Results With 33% Year-Over-Year Annual Revenue Growth
Quarterly Revenues Outpace Sequential Growth of Large Networking Peers and Increase 31 Percent Year-Over-Year
Brocade today reported financial results for its fourth fiscal quarter and full fiscal year ended October 31, 2009. Brocade’s quarterly revenues increased 31 percent year-over-year to $521.8 million and annual revenues increased 33 percent year-over-year to over $1.95 billion.
“Fiscal 2009 was a transformational year as Brocade became one of only two end-to-end networking solutions providers in the industry,” said Michael Klayko, CEO of Brocade. “Brocade also delivered exceptionally strong year-over-year revenue growth and increased its account penetration in the Ethernet networking market while growing share in the storage networking market.”
Klayko continued, “In addition, Q4 saw tremendous momentum as we exceeded the Street’s consensus non-GAAP EPS estimates for the seventeenth consecutive quarter, delivered the fastest sequential revenue growth of any large networking vendor, and generated strong cash flows. Looking at 2010, we expect to continue our momentum as we execute our strategy of delivering the highest levels of performance, quality, innovation and choice to the IT market.”
Brocade management has posted prepared comments and slides on its Fiscal Q4 and 2009 results and Fiscal 2010 outlook at www.BRCD.com in addition to this press release. Brocade will host a live webcast conference call to answer questions from investors and analysts at 5:00 a.m. Pacific time on November 24. Questions may be also submitted in advance to ir@brocade.com.
Financial Highlights and Additional Financial Information
- Fiscal year 2009 revenue was $1,952.9 million, increasing 33% over fiscal year 2008.
- Q4 revenue was $521.8 million, increasing 31% year-over-year and 6% sequentially.
- Q4 total Storage Area Networking (SAN) port shipments were approximately 1.0 million.
- Q4 SAN Average Selling Price (ASP) declines were in the low single digits.
- Q4 effective GAAP tax rate was (24.9)%; non-GAAP effective tax-rate was 25.3%.
- Q4 Adjusted EBITDA was $130.6 million, increasing from $119.3 million in Q3.
- Q4 non-GAAP operating margin was 22.7%, increasing from 20.3% in Q3.
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| Q4 2009 |
| Q3 2009 |
| Q4 2008 |
Revenue |
| $521.8 M |
| $493.3 M |
| $398.5 M |
GAAP net income (loss) |
| $33.6 M |
| $(21.0) M |
| $35.6 M |
Non-GAAP net income |
| $73.4 M |
| $55.4 M |
| $75.8 M |
GAAP EPS – diluted |
| $0.07 |
| ($0.05) |
| $0.09 |
Non-GAAP EPS – diluted |
| $0.15 |
| $0.12 |
| $0.20 |
Non-GAAP gross margin |
| 59.5% |
| 58.2% |
| 64.1% |
Non-GAAP operating margin |
| 22.7% |
| 20.3% |
| 26.2% |
Adjusted EBITDA (4) |
| $130.6 M |
| $119.3 M |
| $142.1 M |
Cash provided by operations |
| $155.3 M |
| $16.6 M |
| $168.6 M |
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Non-GAAP financial measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. A detailed reconciliation between GAAP and non-GAAP information is contained in the tables included herein. | ||||||
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As a % of total revenues |
| Q4 2009 (3) |
| Q3 2009 |
| Q4 2008 |
OEM revenues |
| 65% |
| 63% |
| 88% |
Channel/Direct revenues |
| 35% |
| 37% |
| 12% |
10% or greater customer revenues |
| 46% |
| 46% |
| 65% |
Domestic revenues (1) |
| 63% |
| 64% |
| 64% |
International revenues (1) |
| 37% |
| 36% |
| 36% |
Data Storage Revenue |
| 58% |
| 58% |
| 84% |
Ethernet Products Revenue |
| 25% |
| 24% |
| 0% |
Stackable % of Ethernet Revenues (2) |
| 30% |
| 26% |
| 28% |
Chassis % of Ethernet Revenues (2) |
| 70% |
| 74% |
| 72% |
Enterprise % of Ethernet Revenues (2) |
| 86% |
| 83% |
| 73% |
Service Providers % of Ethernet Revenues (2) |
| 14% |
| 17% |
| 27% |
Global Services Revenue |
| 17% |
| 18% |
| 16% |
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| Q4 2009 |
| Q3 2009 |
| Q4 2008 |
Cash, cash equivalents and investments |
| $338.9 M |
| $249.9 M |
| $820.1 M |
Deferred revenues |
| $235.4 M |
| $230.1 M |
| $141.2 M |
Capital expenditures – non-campus related |
| $ 16.7 M |
| $ 20.0 M |
| $ 13.9 M |
Capital expenditures – campus related |
| $ 27.8 M |
| $ 24.8 M |
| $ 4.7 M |
Total debt, net of discount |
| $1,085 M |
| $1,139 M |
| $1,225 M |
Days sales outstanding |
| 52 days |
| 56 days |
| 36 days |
Employees at end of period |
| 4,070 |
| 3,866 |
| 2,834 |
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