Boring Barracuda says sales are going swimmingly – again

Steady as she goes predictable revenue rise for low-profit biz


It's getting predictable. Barracuda has posted yet another year-on-year revenue rise with yet another small profit. Boring is good, though, right?

For the three months to August 31 this year, its second fiscal 2018 quarter, the California-based outfit recorded revenues of $94.3m, up seven per cent from last years's $87.9mn and just $100,000 more than the previous quarter's $94.2m.

GAAP net income was $1.6m, down 33 per cent from the year-ago $2.4m and the previous quarter's $2.1m.

Subscription revenue grew to $76.0m, up 14 per cent from $66.9mn a year ago, representing 81 per cent of total revenue, and appliance revenue was $18.3m, compared with $21m in the second quarter of fiscal 2017. Subscriptions are where it's at, and the number of active subscribers grew 17 per cent to over 348,000 as of August 31, 2017.

President and chief exec BJ Jenkins said, on revealing the figures this week: "Excluding non-core billings, we have generated four consecutive quarters of double-digit billings growth. We believe we have the right strategy in place, are focused on the right areas of the market, and provide innovative security solutions that are affordable and consumable in the form that is best suited for our customers' needs."

Barracuda_results_Q2_fy2018

Performance ... How Barracuda's figures stack up

William Blair analyst Jason Ader noted the gross margin was down, and attributed this to "a combination of investments in public-cloud infrastructure, mix-shift, and non-recurring charges related to the company’s hardware refresh program."

"Management expects gross margins to improve sequentially by 50 basis points in both the third and fourth quarters," he said. "The company saw some benefit to both revenue and pipeline from recent breaches at Equifax, Deloitte, and others as such incidents lead to more opportunities in email and application security."

Ader reckons "the frequency of ransomware attacks is creating demand tailwinds for both Barracuda’s email security and backup products."

We've seen seven profitable quarters in a row, at $3.2m or less a quarter. It's not a huge money-making machine but it is steady, predictable and reliable. Dull, boring even, but boring means good here.

Barracuda has $125.6m in cash and equivalents, and little debt. It is heading toward a $500m revenue number in 2019 or so. Might it be looking at possible acquisitions to spur growth beyond the current rate? Next quarter's revenue is expected to be between $92.5m and $94.5m, and up on the year-ago quarter's $88.8m. ®


Tech Resources

The State of Application Security 2020

Forrester analyzed the state of application security in 2020 and found over 75% of external attacks are attributed to web application and software exploits.

How backup modernization changes the ransomware game

If the thrill of backing up your data and wondering if you will ever see it again has worn off, start the new year by getting rid of the lingering pain of legacy backup. Bipul Sinha, CEO of the Cloud Data Management Company, Rubrik, and Miguel Zatarain, Director of Global Infrastructure Technology at PACCAR, Fortune 500 manufacturer of trucks and Rubrik customer, are talking to the Reg’s Tim Phillips about how to eliminate the costly, slow and spotty performance of legacy backup, and how to modernize your implementation in 2021 to make your business more resilient.

Webcast Slide Deck | Three reasons you need a hybrid multicloud

Businesses need their IT teams to operate applications and data in a hybrid environment spanning on-premises private and public clouds. But this poses many challenges, such as managing complex networking, re-architecting applications for the cloud, and managing multiple infrastructure silos. There is a pressing need for a single platform that addresses these challenges - a hybrid multicloud built for the digital innovation era. Just this Regcast to find out: Why hybrid multicloud is the ideal path to accelerate cloud migration.

Anatomy of a Private Cloud

Learn the key elements that combined, build a true Private Cloud

Biting the hand that feeds IT © 1998–2021