Brocade Communications Systems Inc. (Nasdaq: BRCD)
today showed it is holding its own in an increasingly fierce battle among SAN switch vendors, as it announced improved sales in the fourth quarter.
Brocades quarterly revenues of $145 million and earnings of $8 million, or $0.03 per share, were slightly above consensus estimates (First Call projected $0.01). Revenues increased 5 percent from the previous quarter and 18 percent from the same quarter last year. Net income rose nearly 73 percent sequentially, up from $4.6 million, or $0.02 per share, last quarter.
CEO Greg Reyes said Brocade made gains in the enterprise, midrange, and entry-level markets and increased its worldwide installed port base 12 percent to 3.4 million. We saw revenue growth across our entire business, he said during a conference call with analysts.
Brocade's results suggest that it's suffering less in the Fibre Channel market than its longtime rival McData Corp. (Nasdaq: MCDTA), given the squeeze caused by the entry of Cisco Systems Inc. (Nasdaq: CSCO). Cisco last week announced its storage networking revenues grew 120 percent sequentially to $40 million, signaling it is finally making inroads after entering the market in late 2002 (see Cisco Storage Growing Up).
Reyes said he doesn't want to make too much of Cisco's quarter, noting that a good deal of Cisco's revenues were carried over from the previous quarter, when it had production problems. "It remains to be seen if the last quarter for Cisco was a one-time event or a harbinger of things to come, Reyes said.
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