Updated from May 27

Shares in

Blue Coat Systems

(BCSI)

slid almost 21% early Friday after the Web security gear maker posted weaker-than-expected quarterly earnings later Thursday.

The Sunnyvale, Calif., company makes so-called proxy appliances that help companies control Internet access. For its fourth quarter ended April 30, Blue Coat posted a profit of $1.4 million, or 11 cents a share. That reverses the year-ago loss of $1.2 million, or 14 cents a share.

Excluding certain costs, the company earned 20 cents a share, which is short of the 24-cent Wall Street analyst estimate provided by Thomson First Call. Revenue rose 79% from a year ago and 10% sequentially, hitting $21.1 mllion.

The company also predicted it would earn 20 to 21 cents a share for its first quarter ending in July, on a so-called non-GAAP basis. The forecast is short of the 24-cent Wall Street consensus estimate. The company guided to 7%-8% revenue growth, which is in line with expectations.

"This is has been an exciting and successful year for Blue Coat," said CEO Brian NeSmith. "Organizations now realize that employee access to the Web is creating risks to the business, and that the proxy appliance provides the necessary visibility and control to minimize those risks. I am optimistic about fiscal 2005, as we are uniquely positioned to capitalize on this growing opportunity."

Blue Coat shares, which at one point had jumped tenfold over the past year, tumbled $8.18, or 20.9%, in premarket action, to $31.07.