Revenue Down But Income Up For Cabletron - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
News

Revenue Down But Income Up For Cabletron

Cabletron Systems Inc., the fourth-largest maker of computer networking equipment, yesterday reported first-quarter income before special charges that exceeded analyst expectations, as the company tried to reposition itself to compete more effectively against its larger rivals.

Cabletron, in Rochester, N.H., reported net income, not including one-time charges, of $7.3 million, or 4 cents per share, in the quarter ended May 31, compared with break-even results in the same quarter a year ago. Revenue declined to $349.5 million in this year's first quarter from $365.7 million in the same period last year. The mean analyst estimate for Cabletron's operating income was 2 cents per share.

Cabletron's gross profit margin, however, declined to 39% of sales in this year's first quarter, from 41% in the same period last year. Research and design expenditures and selling and administrative expenses, meanwhile, remained the same percentage of sales as in the year-ago quarter.

Including an inventory write-off from the discontinuation of several product lines and one-time restructuring charges, Cabletron lost $22.5 million, or 13 cents per share, in the quarter, compared with a loss of $154.6 million, or 95 cents per share, in last year's first quarter, which included $150 million in special charges.

Cabletron announced earlier this month that company co-founder Craig Benson had resigned as chairman, president, and CEO. Piyush Patel, formerly chief executive of Yago Systems, a closely held company Cabletron acquired in 1998, became Cabletron's new leader.

Cabletron is now focusing on its line of "smart products," including SmartSwitches, SmartSwitch routers, and SmartStacks. Its SmartSwitch router is designed to deliver more than 100 times the performance of a traditional router, with a transmission speed of 30 million packets/cells per second.

Cabletron stock yesterday rose 1-13/16 to close at 15-3/4. The earnings were released after the close of trading.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
State of the Cloud
State of the Cloud
Cloud has drastically changed how IT organizations consume and deploy services in the digital age. This research report will delve into public, private and hybrid cloud adoption trends, with a special focus on infrastructure as a service and its role in the enterprise. Find out the challenges organizations are experiencing, and the technologies and strategies they are using to manage and mitigate those challenges today.
Slideshows
Reflections on Tech in 2019
James M. Connolly, Editorial Director, InformationWeek and Network Computing,  12/9/2019
Slideshows
What Digital Transformation Is (And Isn't)
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/4/2019
Commentary
Watch Out for New Barriers to Faster Software Development
Lisa Morgan, Freelance Writer,  12/3/2019
Register for InformationWeek Newsletters
Video
Current Issue
The Cloud Gets Ready for the 20's
This IT Trend Report explores how cloud computing is being shaped for the next phase in its maturation. It will help enterprise IT decision makers and business leaders understand some of the key trends reflected emerging cloud concepts and technologies, and in enterprise cloud usage patterns. Get it today!
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll