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Brocade slides to $4m net loss in fourth quarter

Alex Scroxton

Storage and networking vendor Brocade has slipped to a $4m (£2.6m) GAAP net loss in the fourth quarter of its fiscal 2011, down from $22m year-on-year and $2m in the third quarter, after booking flat year-on-year sales of $550m.

The firm's Ethernet products once again led the way, growing 11% year-on-year to $189.2m, driven primarily by service provider and enterprise customers, which offset a 14% slump in its US Federal business. Storage, traditionally its bread-and-butter, was down 4% on this time last year, but still made up the bulk of sales, contributing $361.3m.

OEM sales held roughly steady at 62% of the total, with channel and direct sales making up the remaining 38%.

The firm is predicting sales to be either flat to down in the first quarter of its fiscal 2012, which worldwide sales senior vice president Ian Whiting put down to Eurozone issues and the expected impact from the failure of the US' bipartisan super committee to reach a compromise yesterday.

Despite the underwhelming headlines results, Brocade pointed to a record performance in some areas, with EMEA Ethernet revenues up 60%. The firm claimed to also now have 60% penetration of Ethernet sales into its top 100 SAN accounts.

Said Whiting: "In the last couple of quarters we've seen a growing contribution from our channel partners, which we measure in a number of ways for the key metrics or [the] number of new opportunities that are created by our partners ... that's reflected in the way they bring those opportunities to us through deal registration."


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