Riverbed: Fiscal 1Q08 Financial Results

Riverbed Technology, Inc. released financial results for the first fiscal quarter ended March 31, 2008.

Revenues for the first quarter of 2008 were $73 million, an increase of 71% from the first quarter of 2007. Riverbed posted GAAP net income of $638,000, or $0.01 per share, in the first quarter of 2008, compared to net income of $3.3 million, or $0.05 per share, in the first quarter of 2007. Riverbed’s first quarter of 2008 GAAP results included $11.3 million of stock-based compensation expenses and related payroll taxes. Excluding the impact of stock-based compensation and related payroll taxes in all periods, as well as related income tax effects, the non-GAAP net income for the first quarter of 2008 was $7.9 million, or $0.11 per share, compared to non-GAAP net income of $8.6 million, or $0.12 per share, in the first quarter of 2007.

"In the first quarter, we posted 71% revenue growth year-over-year but our results were impacted by a lengthening sales cycle at some accounts due to macro-economic trends," said Jerry Kennelly, Riverbed president and chief executive officer. "While we had fewer large deals in the first quarter than in recent periods, we did see broad-based demand from our installed base and added approximately 500 new customers this quarter across a broad range of verticals. With these new customers, we now have over 4,000 cumulative customers, including many of the world’s largest companies and interest in our technology continues to grow. Based on our win rate in head-to-head competitions and market reports, our competitive leadership position remains unchanged, and we believe we have further extended our technological lead this quarter with the release of our version 5.0 upgrade."

"Gross margins were the second highest in company history and we generated strong cash flow in the quarter," said Randy Gottfried, Riverbed chief financial officer. "During the quarter, we generated $22 million in cash from operations and ended the quarter with $269 million in cash, cash equivalents and marketable securities."

Additionally, Riverbed announced today that its board of directors approved a share repurchase program that authorizes the company to purchase up to $100 million of the company’s common stock, as market and business conditions warrant.

"We believe the current share price does not reflect the strength of the company’s long-term growth prospects, and believe this action underscores our confidence in our business and our continued commitment to maximizing value for our shareholders," added Mr. Kennelly.

Riverbed Technology, Inc.