FalconStor Software, Inc. (NASDAQ: FALC), the provider of disk-based data protection solutions, today announced financial results for its second quarter ended June 30, 2012.
Total revenues for the second quarter of 2012 were $16.5 million, compared with $19.6 million for the same period a year ago.
As a result of the Company’s increased dependence on revenues outside North America, with overseas business now accounting for over fifty percent of the Company’s total revenues, the recent slowness in Asian and European markets negatively impacted the Company’s second quarter results. As a result of the slower than anticipated recovery around the world, the Company must realign its existing cost structure based on the declines in revenues it has experienced. Accordingly, commencing in the third quarter, the Company engaged in a cost-reduction initiative that is expected to result in approximately $10.0 million in gross annualized savings. This action includes approximately a 7 percent reduction in existing workforce, the elimination of select positions, and other cost savings initiatives. The cost reductions impact all levels and regions of the Company and are designed to help streamline our operations and focus our efforts and resources more efficiently in the current environment. The estimated cost of this action, which is expected to be completed by the end of the third quarter, is approximately $0.65 million to $0.85 million.
Also during the quarter, the Company announced the successful resolution of the investigations by the United States Attorney’s Office for the Eastern District of New York and by the Securities and Exchange Commission. Total payments by the Company to settle the investigations will equal $5.8 million.“FalconStor is committed to innovation and the delivery of novel and disruptive data protection solutions,” said Jim McNiel, president and CEO. “Our expense reductions address changing global market conditions and deliver a sustainable business model while preserving our ability to deliver new products to a demanding market.”
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV