Fusion-io Q3 Loss Widens, Misses View; Provides Weak Sales Outlook

(RTTNews) - Storage drive maker Fusion-io, Inc. (FIO) reported Wednesday a loss for the third quarter that widened from last year, despite revenue growth, reflecting significantly lower gross margins. Adjusted loss per share came in wider than analysts' expectations by a penny, while quarterly revenues topped their estimates. The company also provided weak sales guidance for the fourth quarter.

"In Q3, we evolved our solutions-based go-to-market strategy through close collaboration with our OEM and ISV partners to offer our customers significant performance gains while lowering their datacenter operating expense," Chairman and CEO Shane Robison said in a statement.

The Salt Lake, Utah-based company reported a net loss of $30.65 million or $0.29 per share for the third quarter, wider than $20.05 million or $0.21 per share in the prior-year quarter.

Excluding items, adjusted net loss for the quarter was $10.47 million or $0.10 per share, compared to adjusted net loss of $3.17 million or $0.03 per share in the year-ago quarter.

On average, 22 analysts polled by Thomson Reuters expected the company to report a loss of $0.09 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter grew to $100.53 million from $87.65 million in the same quarter last year, and topped twenty-one Wall Street analysts' consensus estimate of $96.70 million.

Gross margin for the quarter contracted 490 basis points to 51.0 percent from last year's 54.9 percent. Total operating expenses were $81.50 million, up from $76.60 million from last year.

Looking ahead to the fourth quarter of fiscal 2014, Fusion-io forecasts revenues to be in-line to slightly up sequentially, while analysts are expecting $107.46 million.

FIO closed Wednesday's regular trading session at $9.68, down $0.25 or 2.52% on a volume of 3.48 million shares. The stock plunged a further $0.46 or 4.75% in after-hours trading.