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Quantum of solace: Mega cloud signing to end years of hurt?

Hires new chief bean counter and sees revenue decline reversing – maybe

Quantum says it has won a major cloud storage deal that could help reverse years of falling revenues. It's also announced a new chief financial officer: Fuad Ahmad will take over from Linda Breard.

Breard became Quantum's chief beancounter in January 2011, and resigned in January to pursue another opportunity.

Ahmad gets an SVP title as well. Jon Gacek, Quantum's CEO and president, put out an anodyne canned quote: "Fuad has a broad range of executive experience driving increased growth and profitability in different technology sectors. This experience will serve Quantum well as we build on the progress we made in key areas during fiscal 2016 and look to capitalize on our scale-out storage opportunities, to further leverage our data protection assets and to deliver greater shareholder value in this new fiscal year and beyond."

Nothing untoward in this.

There's more interest in the company's preliminary fourth quarter results. They hit approximately the US$120m revenue number, the mid-point of its estimated revenue range for the quarter. That will be 18.8 per cent down on the year-ago quarter and 6.3 per cent down the the third fiscal year 2016 quarter.

It made a loss in the third fiscal 2016 quarter and so we expect another loss this quarter. Nothing to be pleased about there you would think.

The full FY2016 revenues will be around $479.5m, down on FY2015's $553.1m – the ninth year since fiscal 2008 in which revenues have fallen. More bad news then, but – yes, there is a but – Gacek said Quantum secured "a major, multi-year scale-out storage win for a large cloud project that is expected to contribute significant revenue over the course of fiscal 2017. In fact, we expect this win and our overall scale-out storage opportunity will result in year-over-year total revenue growth in fiscal 2017 as well as higher profitability and cash flow."

That is good news. Scale-out storage means StorNext and cloud storage possibly means Lattus object storage. We'll find out more in the full earnings announcement, which will be made on May 10. ®

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