Thursday, April 10, 2008

Foundry Issues Preliminary Results, Cites Macroeconomics

Foundry Networks announced preliminary results for Q1 2008, saying it now expects revenue to range between $148.0 million and $150.0 million, compared to $135.8 million in the first quarter of 2007. GAAP net income is expected to range between $13.0 million and $14.0 million, or $0.08 and $0.09 per diluted share including approximately $8.5 million of tax-effected stock-based compensation, compared to $9.1 million or $0.06 per diluted share in the first quarter 2007, including $5.8 million of tax-effected stock-based compensation.

"Entering the quarter we expressed our view that Foundry would experience typical seasonality, however during the first quarter a more challenging macroeconomic environment evolved from the financial market crises which we believe led some customers to delay their purchase decisions," said Bobby Johnson, President and CEO of Foundry Networks. "While business activity remained robust, order closure rates in most geographies fell below our expectations. We believe the recent investments we've made in our sales organization have strengthened our capabilities and together with our strong product portfolio will have a potentially positive impact particularly as the macroeconomic environment becomes more settled."