Shares of Fusion-io, Inc. (FIO) gained more than 12 percent in extended trading on Wednesday after the memory drive maker forecast revenues for the fourth quarter and fiscal 2013 above analysts' consensus estimates. The company also reported better-than-expected results for the third quarter.
Separately, Fusion-io said it acquired Colorado-based NexGen Storage for about $119 million in cash and stock. NexGen is a developer of hybrid storage appliances based on Fusion ioMemory for small to medium enterprises or SMEs.
Salt Lake, Utah-based Fusion-io's third-quarter net loss widened on lower revenues. However, adjusted loss per share was narrower than analysts' expectations, while revenues beat their estimates.
Fusion-io's net loss for the third quarter widened to $20.05 million or $0.21 per share from $4.68 million or $0.05 per share in the year-ago period.
Excluding items, adjusted net loss for the quarter was $3.17 million or $0.03 per share, compared to adjusted net income of $6.92 million or $0.06 per share in the year-ago period. On average, twenty four analysts polled by Thomson Reuters expected the company to report loss of $0.07 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the quarter declined 7 percent to $87.65 million from $94.24 million in the same period last year. Analysts had a consensus revenue estimate of $80.48 million.
Reported gross margin for the quarter rose to 55.1 percent from 52.1 percent in the previous-year quarter. Operating margin was negative 32.5 percent, compared to negative 5.2 percent in the year-ago period.
Looking ahead to the fourth quarter, Fusion-io expects revenue of about $110 million. Analysts expect the company to report revenues of $107.34 million for the quarter.
For fiscal 2013, Fusion-io continues to expect revenue of about $435 million. Analysts expect the company to report revenues of $426.43 million for the year.
Regarding its acquisition of NexGen, Fusion-io noted that by using software in combination with ioMemory and standard disk drives, NexGen transforms x86 server platforms into hybrid storage systems that provide the performance of an all-flash array at a fraction of the cost. Fusion-io said it will add about 50 NexGen employees to its team.
David Flynn, Fusion-io chairman and chief executive officer of Fusion-io said, "With the acquisition of NexGen Storage, Fusion-io is aggressively expanding into the small to medium enterprise market with a hybrid solution that cost-effectively achieves the performance of an all-flash array. NexGen's hybrid storage system creates growth opportunity in an important market segment and strongly complements our portfolio of software defined, open systems."
FIO closed Wednesday's regular trading at $16.63, down $0.17 or 1.01 percent on a volume of 4.99 million shares. However, in after-hours, the stock gained $2.01 or 12.09 percent to $15.01.
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