WESTFORD, Mass.--(BUSINESS WIRE)--Jan. 6, 2009--
NetScout
Systems, Inc. (NASDAQ: NTCT)
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Q3 FY 2009
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GAAP
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Non-GAAP
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Estimated Revenue (millions)
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$71 to $72
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$73 to $74
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Estimated Net Income per share
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$0.16 to $0.18
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$0.24 to $0.26
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FY 2009 Guidance
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GAAP
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Non-GAAP
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Expected Revenue (millions)
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$266 to $274
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$278 to $286
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Expected Net Income per share
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$0.44 to $0.54
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$0.81 to $0.91
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NetScout
Systems, Inc. (NASDAQ: NTCT), an industry pacesetter in advanced
network and service assurance solutions, today announced preliminary
results for the third quarter of fiscal year 2009, ended December 31,
2008, and raised guidance for fiscal year 2009.
For the third quarter, GAAP revenue is estimated to be in the range of
$71 million to $72 million with GAAP net income per diluted share
between $0.16 and $0.18. Non-GAAP revenue is expected to be in the range
of $73 million to $74 million with non-GAAP net income per diluted share
between $0.24 and $0.26. The third quarter fiscal year 2009 non-GAAP
revenue estimate excludes the purchase accounting adjustment to fair
value of approximately $2.1 million of Network General’s deferred
revenue, and net income per diluted share estimate excludes the purchase
accounting adjustment to fair value, share-based compensation expenses
of approximately $1.2 million, amortization of acquired intangible
assets of approximately $1.5 million, and integration expenses of
approximately $350 thousand.
For the 2009 fiscal year ending March 31, NetScout is raising its
outlook for GAAP revenue to a range of $266 million to $274 million with
GAAP net income per diluted share between $0.44 and $0.54, and non-GAAP
revenue to a range of $278 million to $286 million, with non-GAAP net
income per diluted share between $0.81 and $0.91. Higher fiscal 2009
non-GAAP revenue estimate excludes the purchase accounting adjustment to
fair value of approximately $11.8 million of Network General’s deferred
revenue, and net income per diluted share estimate excludes the purchase
accounting adjustment to fair value, share-based compensation expenses
of approximately $4.8 million, amortization of acquired intangible
assets of approximately $6 million, and integration expenses of
approximately $1.7 million.
Based on this fiscal 2009 outlook, our expectations for the fiscal
fourth quarter are for GAAP revenue of $66 million to $73 million and
non-GAAP revenue of $67 million to $74 million. GAAP net income per
diluted share for the fourth quarter is expected to be in the range of
$0.12 to $0.20. Non-GAAP net income per diluted share is expected to be
in the range of $0.18 to $0.26.
Stronger than expected bookings in the quarter were led by the
telecommunications sector, driven primarily by stronger demand from
wireless carriers. Intensifying competition among carriers to provide
advanced data services to mobile devices is an increasingly robust
source of growth for NetScout’s business. Financial services customer
demand was comparable to prior years, with strong demand from electronic
exchange and trading customers as well as legacy commercial banks
offsetting almost negligible demand for new products from traditional
investment banks. Bookings from the government and healthcare sectors
were solid and buying from the energy sector strengthened. To date the
economic downturn has not substantially impacted business from these
major market sectors, which typically provide three fourths of our
business.
“While we remain cautious about the effect on our customers of the
turmoil in the financial markets and in the broader economy, we are
encouraged that we have only seen a modest impact on our business.
Demand for our market-leading management solution is growing among the
most advanced users of large scale, performance sensitive
infrastructures. We expect further strengthening in the wireless sector
as we add carrier relevant functionality to our products at an
increasing pace. We are also seeing a growing demand for our solutions
in other vertical markets as our customers work to overcome the
challenges of managing the modern IP network. Thanks to these dynamics,
our visibility into the near term direction of our business remains
strong. We are confident in our guidance for the balance of this fiscal
year,” said Anil Singhal, President and CEO of NetScout Systems. “We
look forward to providing more information about our third quarter
performance in our scheduled earnings release and conference call on
January 22, 2009. We anticipate providing fiscal 2010 guidance in our
fourth quarter earnings conference call in April 2009 by which time
calendar 2009 budgets will have been set by our large customers.”
Use of Non-GAAP Financial Information
To supplement the financial measures presented in the Company's press
release in accordance with accounting principles generally accepted in
the United States ("GAAP"), the Company also presents non-GAAP measures
relating to revenue and net income per diluted share which were adjusted
from amounts determined based on GAAP to exclude the purchase accounting
adjustment representing the fair value of Network General’s deferred
revenue, share-based compensation expenses, amortization of acquired
intangible assets, integration expenses as well as the related income
tax effects.
These non-GAAP measures are not in accordance with, and should not be
considered an alternative for measures prepared in accordance with GAAP,
and these non-GAAP measures may have limitations in that they do not
reflect all of NetScout’s results of operations as determined in
accordance with GAAP. These non-GAAP measures should only be used to
evaluate NetScout’s results of operations in conjunction with the
corresponding GAAP measures. The presentation of non-GAAP information is
not meant to be considered superior to, in isolation from or as a
substitute for results prepared in accordance with GAAP.
The Company believes these non-GAAP financial measures will enhance the
reader’s overall understanding of NetScout’s current financial
performance and the Company's prospects for the future by providing a
higher degree of transparency for certain financial measures and
providing a level of disclosure that helps investors understand how the
Company plans and measures its own business. The Company believes that
providing these non-GAAP measures affords investors a view of the
Company’s operating results that may be more easily compared to peer
companies and also enables investors to consider the Company’s operating
results on both a GAAP and non-GAAP basis during the integration period
of the Company’s acquisition of Network General. Presenting the GAAP
measures on their own would not be indicative of the Company’s core
operating results. Furthermore, NetScout believes that the presentation
of non-GAAP measures when shown in conjunction with the corresponding
GAAP measures provide useful information to management and investors
regarding present and future business trends relating to its financial
conditions and results of operations.
About NetScout Systems
NetScout Systems, Inc. (NASDAQ: NTCT) has been an industry pacesetter
for advanced network and service assurance solutions for over a decade,
and counts the world’s largest enterprises, government agencies, and
service providers among its customers. Enterprise and government IT
organizations deploy NetScout's nGenius® Performance Management
System to increase service levels to their users by reducing or
preventing service disruptions. Service providers depend on NetScout’s
proven IP performance management technology and expertise to protect the
quality of their customers’ experience with IP-based services. NetScout
is headquartered in Westford, Massachusetts and has offices worldwide.
Further information is available at http://www.netscout.com.
Safe Harbor:
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of Section 21E of the Securities Exchange Act of 1934
and other federal securities laws. Investors are cautioned that
statements in this press release, which are not strictly historical
statements, including the plans, objectives and future financial
performance of NetScout, constitute forward-looking statements which
involve risks and uncertainties. Actual results could differ materially
from the forward-looking statements. Risks and uncertainties which could
cause actual results to differ include, without limitation, risks and
uncertainties associated with slowdowns or downturns in economic
conditions generally and in the market for advanced network and service
assurance solutions specifically, the Company’s relationships with
strategic partners, dependence upon broad-based acceptance of the
Company’s network performance management solutions, the Company’s
ability to achieve and maintain a high rate of growth, introduction and
market acceptance of new products and product enhancements, the ability
of the Company to take advantage of service provider opportunities,
competitive pricing pressures, reliance on sole source suppliers,
successful expansion and management of direct and indirect distribution
channels and dependence on proprietary technology. For a more detailed
description of the risk factors associated with the Company, please
refer to the Company’s Annual Report on Form 10-K for the fiscal year
ended March 31, 2008 and subsequent Quarterly Reports on Form 10-Q on
file with the Securities and Exchange Commission. NetScout assumes no
obligation to update any forward-looking information contained in this
press release or with respect to the announcements described herein.
©2008 NetScout Systems, Inc. All rights reserved. NetScout and the
NetScout logo and nGenius are registered trademarks of NetScout
Systems, Inc.
Source: NetScout Systems, Inc.
NetScout Systems, Inc.
Catherine Taylor, 978-614-4286
Director
of Investor Relations
IR@netscout.com