Sunday, April 3, 2011

Meru to Miss Q1 Financial Guidance

Meru Networks expects to report first quarter revenue in the range of $20.0 million to $20.5 million. The company had previously provided revenue guidance in the range of $21.5 million to $22.5 million. First quarter non-GAAP operating expenses, which excludes the impact of stock based compensation expenses of approximately $1.3 million, are expected to be in the range of $14.7 million to $14.8 million, compared to prior guidance of approximately $14.8 million.

"In the first quarter we saw a number of transactions, primarily in the United States, that we anticipated would close but with the quarter concluded, it is now apparent that these transactions are experiencing longer than expected approval processes," said Ihab Abu-Hakima, president and chief executive officer of Meru Networks. "This included a lengthening of the budget approval process for a number of our domestic education customers. We continue to believe there is a healthy market for wireless LAN solutions, and accordingly during the first quarter we increased our investment in our sales teams and channel partners to capitalize on this opportunity. We plan to continue increasing our investment in sales coverage and capacity, and expect to announce a new head of worldwide sales in the coming weeks."

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