Quantum (QTM) Q4 2012 Earnings Call May 09, 2012 5:00 pm ET Executives Shawn D. Hall - Senior Vice President, General Counsel and Secretary Jon W. Gacek - Chief Executive Officer, President, Chief Operating Officer and Director Linda M. Breard - Chief Financial Officer, Chief Accounting Officer, Senior Vice President of Finance, IT and Facilities Analysts Ryan R. Bergan - Craig-Hallum Capital Group LLC, Research Division Glenn Hanus - Needham & Company, LLC, Research Division Catharine Anne Trebnick - Northland Securities Inc., Research Division Cindy Shaw - DISCERN Investment Analytics, Inc Brian Freed - Wunderlich Securities Inc., Research Division Presentation Operator
With that, I'll turn the call over to Jon Gacek.Jon W. Gacek Thanks, Shawn. Welcome to our fiscal Q4 earnings call. Today, I'm going to address several key business points from Q4 and the full year and Linda will walk you through the detailed results for Q4. I will then come back and talk about our market opportunity in fiscal '13 and beyond for data protection, big data management and archive and cloud solutions, describe our key achievements from fiscal 2012 that position us for overall growth this year and close with our guidance for the current quarter and fiscal '13. In addition, today we announced in a separate press release a technology partnership with Amplidata that will allow Quantum to offer a unique and new category of storage solutions for big data management, archive and protection as well as cloud customers. I will touch on this more at the end of the call, but I encourage you to read the release as it provides detail about the unique capabilities of the Amplidata technology and the power of tightly integrating it with our StorNext appliance strategy. So let me move to the results. For Q4, we reported revenue of $160.3 million. This was within our guidance range of $160 million to $170 million, but clearly at the low end of that range. As we mentioned in our last earnings call, we entered the quarter with very positive momentum driven by our new products, specifically DXi and StorNext appliances. But we tempered that enthusiasm due to overall macroeconomic concerns generally, and specifically, concerns with Europe. I'm going to address the geographic results first. We were very strong in North America, and specifically strong in StorNext, DXi, midrange tape automation and tape media. In Asia, this was the first quarter this year where we didn't exceed our plan and the shortfall was across all products. In Europe, like others in our industry, we were below plan overall and had difficulty closing the larger deals. More specifically, from a product perspective, we did okay in Europe on DXi and StorNext, but we were weak in Enterprise tape. There is no question that our revenue results being at the low end of our range were primarily due to geographic issues.
In terms of Q4 highlights, the most significant, from a product revenue perspective was disk systems and software revenue, including related maintenance of $37.6 million. This is a record, despite it being a seasonally weak quarter and the impacts from Europe and Asia mentioned earlier. This category grew 28% year-over-year and was up slightly compared to Q3, which is our seasonally strongest quarter. The growth was driven by record branded disk revenue, including approximately 100% sequential growth in DXi8500 sales and branded StorNext software and StorNext appliance revenue. We added 160 new Disk and Software customers, and we closed on a number of large deals with both new customers and existing customers that made follow-on orders. In short, we are very pleased with the overall result in disk systems and software product revenue category.Another highlight of the quarter was the launch of our DXi V1000, which is our DXi product, and along with our vmPRO virtual protection software, the backbone of our cloud data protection platform. In addition, Xerox launched their backup and disaster recovery cloud services offering which is based on this platform. I encourage you to go to the Xerox website to learn more about how they use Quantum technology. That can be found at acscloud.com, under the Cloud Backup and Disaster Recovery as Service tab. We think this is a very important first step and you're going to see us do more of this going forward. Read the rest of this transcript for free on seekingalpha.com