SAN JOSE, Calif. ( TheStreet) -- Networking specialist Brocade ( BRCD) obliterated Wall Street's estimates with its first-quarter results, released after market close on Tuesday. Brocade brought in revenue of $561 million, an increase of 3% over the same period last year and well above the average analysts' forecast of $542.4 million.
Brocade CEO Mike Klayko
Excluding items, Brocade earned 20 cents per share in the January-ended quarter, up from 12 cents per share in the prior year's quarter. Analysts surveyed by Thomson Reuters were looking for earnings of 13 cents per share. Brocade's GAAP gross margin was 61.5% and its non-GAAP gross margin was 64.8% during the first quarter, up from 58.8% and 62%, respectively, in the same period last year. The gross margin improvement was fueled by higher margin storage products, margin expansion in global services and an increase in overall revenue, the company said. "Q1 was a great quarter for Brocade -- achieving record revenue, expanding gross margins, and increasing profits as we continued to see strong momentum across many areas of our business," explained Michael Klayko, the Brocade CEO, in a statement. Investors responded positively to the numbers. Shares of Brocade, which competes with Cisco ( CSCO) and QLogic ( QLGC), surged 5% to $5.75 in extended trading. Revenue from Brocade's storage business was $406.4 million, a year-over-year increase of 4%. Brocade's Ethernet business brought in $154.3 million, up 1% on the prior year's quarter. -- Written by James Rogers in New York >To follow the writer on Twitter, go to http://twitter.com/jamesjrogers. >To submit a news tip, send an email to: firstname.lastname@example.org.