The company announced its numbers after market close on Monday, predicting revenue between $107 million and $108 million, well above its previous guidance of $88 million to $92 million. Analysts surveyed by Thomson Reuters had predicted sales of $90.7 million.
Excluding items, Emulex expects earnings of 16 cents to 17 cents a share, up from its prior range of 10 cents to 12 cents and above analysts' estimates of 12 cents.
Investors responded positively to the new numbers, pushing Emulex's shares up $1.27, or 11.4%, to $12.41 despite a broader dip in tech stocks that saw the Nasdaq fall 0.76%.
Emulex has been getting plenty of
recently. Paul Mansky of Cannacord Adams recently rated the stock as his top pick for 2010.
Last year, Emulex CEO Jim McCluney told
is underway, spurred on by companies' cloud computing efforts.
The Silicon Valley firm, which makes storage adapters and embedded switches, already boasts a host of partners using its technology in their servers and storage systems, including
Although he did not reveal whether Emulex clinched any new OEM deals for its products, Emulex CEO Jim McCluney said in a statement released Monday that the company's sales are ramping up.
"We executed very well to deliver the December quarter results, which were driven by broad customer demand across both our Host Server Product and Embedded Storage Product lines," he explained. "I'm particularly pleased with the tangible benefits we are now seeing from our sales and marketing efforts over the past year to gain market share in Fibre Channel board level products, and this momentum has continued into the New Year."
Specifically, Emulex's HSP revenue grew 28% sequentially, accounting for around 75% of total sales. Revenue from the company's Embedded Storage Products increased more than 20% over the same period, making up about a quarter of total sales.
The company is also enjoying strength in its Fibre Channel over Ethernet (FCoE) business, which is being touted as a way for firms to streamline data centers by consolidating storage and network traffic. Revenues from Converged Network Adapters (CNAs) running FCoE grew more than 50% compared to the prior quarter, according to Emulex.
Emulex's positive pre-announcement spells good news for investors after the firm's first-quarter profit
on falling sales.
"The surprisingly strong result has clear positive implications for Emulex, particularly given the demonstration of strength across the entirety of the Emulex product set," wrote Avi Cohen, an analyst at Avian Securities, in a note released on Tuesday. "In addition, we would note that the reported 50% sequential growth in the Fibre Channel over Ethernet space almost certainly kept Emulex in a leadership position in that nascent but emerging market."
Cohen nonetheless urged investors to approach Emulex with caution.
"Despite the immediate strength, we are maintaining our neutral view on the name due to intermediate concerns around the future of Emulex's Embedded Storage Products as that business transitions from Fibre Channel to SAS designs," he wrote.
-- Reported by James Rogers in New York