Weak sales in the US have forced Veritas to lower its second quarter earnings forecast today - a move poorly received on Wall Street, where investors pummeled Veritas shares.
Veritas is now looking for second quarter revenue to come in between $475m and $485m. This is a serious drop from the $490m -$505m range provided by Veritas at the end of its first quarter. It's also the first time in quite a while that Veritas delivered negative news to analysts and investors. The storage software maker has been on a solid run over the last few quarters, excluding a few accounting cock-ups.
"Our anticipated results were impacted primarily by weakness in our US enterprise sales," said Gary Bloom, CEO at Veritas. "As we have indicated previously, software license orders are generally concentrated in the later part of the third month of the quarter. At the end of the June quarter, our anticipated order flow weakened, contributing to lower-than-expected license revenues. Our services business remained strong, driven primarily by healthy maintenance renewals throughout the quarter, and the demand for our products and services in most of Europe and Asia Pacific met our expectations."
Investors sent Veritas shares down more than 30 per cent in early trading on the Nasdaq. Veritas was down $8.15 per share to $18.40 at the time of writing. It will report second quarter earnings on 27 July. ®
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