WESTFORD, Mass., March 27 /PRNewswire/ -- NetScout Systems, Inc.
(Nasdaq: NTCT) announced today that based on preliminary information, the
company is revising its earnings guidance for its fiscal fourth quarter ending
March 31, 2001, and for the coming fiscal year 2002. NetScout expects that
the economic conditions being widely reported will affect most sectors of the
Company's client base. These conditions are resulting in sudden, broadening
constraints being applied to IT purchasing, which have delayed orders and
lengthened sales cycles.
The Company expects that these conditions will continue in the near
future. Accordingly, NetScout now expects that revenues for the fourth
quarter of fiscal 2001 will be down to a range of $20 million to $22 million,
and that pro forma earnings per share will be in the range of $0.01 to $0.03.
"Even though we continue to see a strong flow of very good opportunities
and interest in the value provided by our products, it has become extremely
difficult to reliably forecast in this tough economic environment," said Anil
Singhal, President and CEO of NetScout. "Our business fundamentals remain
strong. These fundamentals include our solid cash position, a number of new
product introductions during the next 12 months, an expanded sales force and
improving competitiveness, all of which will allow us to emerge from these
difficult times stronger than ever."
NetScout's expectations looking forward are based on widely reported
economic forecasts that foresee the current difficult economic conditions
continuing through the end of calendar 2001. Further, NetScout anticipates
that the current, abrupt delay in IT spending by many large enterprises will
begin to ease in the second calendar quarter, NetScout's first fiscal quarter,
as they turn their focus to high priority issues such as ensuring strong
oversight and optimal performance of their very large infrastructures. Based
on these assumptions, NetScout expects quarterly sequential revenue growth in
the range of 10% to 12% off the lower revenue base of the current quarter for
the next four quarters. Because of the lowered base, NetScout is taking
significant actions to lower discretionary spending and to limit hiring. As a
result, through fiscal 2002, operating margins are expected to grow from the
low single digits to high teens by the fourth fiscal quarter.
More information on NetScout's fiscal fourth-quarter and full-year 2001
results will be available on April 26th, 2001 when the company intends to
report its final results.
The Company invites shareholders to listen into a conference call today at
5:00 pm EST, which will be Webcast live through the Company's Website at
http://www.netscout.com. A replay of the call will be available after 8:00 pm
EST this evening through April 3, 2001. The number for the replay is (800)
642-1687 for U.S./Canada, and (706) 645-9291 for International callers. The
access code is 103822.
About NetScout Systems
NetScout Systems, Inc. is a leading provider of infrastructure performance
management solutions for leading companies and service providers worldwide.
NetScout serves approximately half of the Fortune 500 and counts among its
customers 3M Corporation, Amazon.com, AT&T Wireless, Bristol-Myers Squibb,
Cable & Wireless, Cisco Systems, Computer Sciences Corporation, Exenet
Technologies, Fidelity Investments, Intel Online, MCI, Reed Elsevier, Sprint,
Sun Microsystems and Webhire. NetScout is headquartered in Westford,
Massachusetts and has approximately 370 employees, with offices in North
America, Europe and Asia. Further information on the company is available on
the World Wide Web at www.netscout.com
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of Section 21E of the Securities Exchange Act of 1934.
Investors are cautioned that statements in this press release which are not
strictly historical statements, including the plans, objectives and future
financial prospects of NetScout, constitute forward-looking statements which
involve risks and uncertainties and are not guaranteed. Actual results could
differ materially from the forward-looking statements in this press release.
Risks and uncertainties which could cause actual results to differ materially
from the forward-looking statements in this press release include, without
limitation, risks and uncertainties associated with the company's strategic
relationships with Cisco Systems and other partners, dependence upon broad-
based acceptance of the company's infrastructure 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 such as the delivery of nGenius product platform probes and
software solutions, the ability of NetScout to take advantage of service
provider opportunities, competitive pricing pressures, reliance on sole source
suppliers, successful expansion and management of indirect distribution
channels, the integration of NextPoint Networks and dependence on proprietary
technology, as well as risks of slowdowns or downturns in economic conditions
generally and in the market for infrastructure performance management
solutions specifically. 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, 2000, and Quarterly Report on
10-Q for the quarter ended December 31, 2000, on file with the Securities and
Exchange Commission.
NetScout is a registered trademark and the NetScout logo is a trademark of
NetScout Systems, Inc.
SOURCE NetScout Systems, Inc.
Web site: http: //www.netscout.com
CONTACT: Peggy Flynn, Director, Investor Relations of NetScout Systems, 978-614-4162, or flynnp@netscout.com; or Bill Zima, Associate Director Technology Consulting of Thomson Financial/Carson Group, 212-510-9261, or bill.zima@tfn.com