Posted by: Dave Raffo
Although Quantum’s revenue declined over last year, CEO Jon Gacek said the backup vendor is in much better shape than it was 12 months ago.
Quantum this week reported revenue of $131.4 million, which was below its guidance and down 11% from the same quarter last year.
Gacek said the plus side is the company cut its loss form $8 million last year to $5 million this year, increased gross margin from 42% to 42.9%, reduced operating expenses by 11% and increased its cash from $33 million to $77 million.
“Last year there was so much anxiety about our balance sheet,” Gacek said. “Our cash has more than doubled and we paid off all our current debt. Last year I had to spend a lot of time defending our viability. Now I’m getting pressure on revenue growth, but last year it was ‘Hey, you lost money again.’”
Gacek blamed the poor revenue last quarter on low federal government spending ahead of this month’s shutdown, and the poor European economy. He said the government problems particularly hurt sales of DXi deduplication backup appliances, which declined 30% over last year. Tape automation revenue declined 15%.
Gacek said he is optimistic about the prospects for recently launched StorNext 5 and new Lattus object storage systems, and is hoping the government spending constraints will lift. “We believe deals that got hung up in the lead up to the federal government shutdown may materialize,” he said. “We know there are deals in the pipeline, it’s a matter of whether they’re going to pop.”