Isilon: Fiscal 3Q09 Financial Results

Isilon Systems, Inc. announced its financial results for the third quarter ended September 30, 2009.

Revenue for the quarter was $30.5 million, up 5 percent sequentially compared with $29.0 million in the second quarter of 2009 and up 1 percent compared with $30.3 million in the third quarter of 2008.

"Isilon performed well in the third quarter. In addition to continued improvement on EPS, I am encouraged both by our sequential revenue growth in what has traditionally been a seasonally-slower quarter, and by our continued firm control of costs," said Sujal Patel, President and Chief Executive Officer, Isilon Systems. "Customer buying patterns began to stabilize during the quarter, leading to balanced sales across our entire range of products and solid gross margins. These results underscore the value that Isilon’s scale-out NAS platform is creating for customers across a broad and growing spectrum of enterprise data storage needs."

Financial results for the third quarter of 2009
included the following:

• Gross margin for the third quarter of 2009 was 56.9 percent, compared with 57.0 percent in the second quarter of 2009 and 57.2 percent in the third quarter of 2008.
• Net loss for the third quarter of 2009 was $4.9 million, or $0.08 per share, compared with net loss of $3.7 million, or $0.06 per share in the second quarter of 2009. Net loss in the third quarter of 2008 was $4.8 million, or $0.08 per share. Non-GAAP net loss for the third quarter of 2009 was $1.4 million, or $0.02 per share, compared with non-GAAP net loss of $2.0 million, or $0.03 per share in the second quarter of 2009. Non-GAAP net loss in the third quarter of 2008 was $3.3 million, or $0.05 per share.
• In the third quarter of 2009, the Company entered into a memorandum of understanding to settle and resolve a shareholder class action lawsuit that was initially filed in November 2007 against the Company and current and former officers and directors. The settlement provides for a payment to the plaintiff class of $15.0 million, of which the Company will contribute $2.0 million and the balance of which will be paid by the Company’s insurers. The $2.0 million for which the Company is responsible is included in the Company’s results of operations for the quarter ended September 30, 2009 and impacted GAAP loss per share by $0.03. The class action settlement is subject to preliminary and final approval by the United States District Court for the Western District of Washington.
• As of September 30, 2009, cash, cash equivalents and marketable securities were $77.0 million, compared with $75.5 million as of June 30, 2009.