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TheStreet Open House

Quantum's CEO Discusses Q4 2011 Results - Earnings Call Transcript

For fiscal 2012, growing our branded revenue will continue to be a key focus. The second item I want to highlight is the overall strength of our product portfolio and the introduction of our DXi 2.0 software in Q4. We exited fiscal 2011 with our Scalar tape libraries, DXi deduplication appliances and StorNext software, all having received enhancements during the year that offer more value to customers. As a result, we believe we're entering this fiscal year with the strongest product portfolio we have had since the Quantum merger with ADIC in 2006. More specifically, with regard to DXi 2.0, this is our fourth-generation DXi software. It has inline deduplication, it delivers industry-leading performance and it allows Quantum customers much greater value than our competitors. The DXi 2.0 software began shipping in mid-March on our DXi4500 and 6500 hardware platforms, and approximately 100 customers have already deployed it. And 2.0 will begin shipping on the DXi6700 and 8500 platforms this summer. Offered at the same price as DXi products with previous-generation software, our appliances running DXi 2.0 deliver both higher performance and better price performance than any other products in their class and as much as 5x an advantage over the nearest competitive offering. This performance improvement makes us the clear leader in not only performance, but price performance. In short, we believe we have a unique product offering to solve customers' problems at the lowest cost.

I also want to mention the improvement in our balance sheet and our capital structure this quarter and fiscal year. This improvement is the result of paying down $82 million of senior debt during the year, with $40 million this quarter in Q4. We made the final $22 million payment on our 2003 convertible debt last August, and we repaid $122 million in C [convertible] debt, which had a 12% interest rate with proceeds from the convertible note issuance of $135 million that has an interest rate of 3.5%.

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