Foundry Networks Reports First Quarter 2006 Financial Results
Thursday April 20, 4:05 pm ET
SAN JOSE, Calif., April 20 /PRNewswire-FirstCall/ -- Foundry Networks(TM), Inc. (Nasdaq: FDRY - News), today reported financial results for its first quarter ended March 31, 2006.
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Foundry's revenue for the first quarter of 2006 was $114.0 million, up 35% from $84.6 million in the first quarter of 2005, and slightly lower compared to $116.1 million in the fourth quarter of 2005. Net income was $11.4 million or $0.08 per diluted share, compared to net income of $9.9 million, or $0.07 per diluted share in the first quarter of 2005, and net income of $20.6 million, or $0.14 per diluted share in the fourth quarter of 2005.
Included in Foundry's results for the first quarter of 2006 was $9.0 million of non-cash stock-based compensation expense as a result of our adoption of SFAS 123R on January 1, 2006. Net income in the first quarter and fourth quarter of 2005 did not include stock-based compensation expense. Excluding this non-cash stock-based compensation expense and the related tax effect, non-GAAP net income in the first quarter of 2006 was $17.4 million and earnings per diluted share were $0.12 per share. Please refer to the table below for a reconciliation of GAAP to non-GAAP net income.
Foundry's first quarter results reflect typical seasonal patterns. Activity from Foundry's Japanese and European customers increased modestly from the fourth quarter while the U.S. Federal Government vertical market declined slightly, representing approximately 19% of Foundry's total net revenue in the first quarter of 2006.
"We are excited about our strong start in 2006," said Bobby Johnson, President and CEO of Foundry Networks. "The seasonally slow business trend we typically experience in the first quarter was mitigated by increased sales of our newly introduced products, as well as improved productivity of our recent sales force additions.
"Sales of our XMR MPLS router, having completed a full quarter of revenue shipments in the March period, as well as our newest Metro router, the MLX which began shipping for revenue in February 2006, had good initial demand from service providers and large enterprise customers. In addition, our BigIron RX family of Layer 2/3 switches continued to increase in both the enterprise and service provider markets and we began revenue shipments of our Layer 4-7 traffic management SSL and security products.
Outlook
"Looking ahead, we plan to introduce several significant new platforms addressing both enterprise and service provider markets in the second quarter of 2006. Given current capital expenditure trends that we have seen within large enterprise and service provider accounts, we believe that as our product portfolio continues to expand, Foundry will be well positioned for continued growth in 2006," concluded Johnson.
Conference Call
Foundry Networks will host a conference call today to further discuss these results at 2:00 p.m. Pacific Time. The call can be accessed via a webcast at www.foundrynetworks.com. A Web replay will also be available for approximately 90 days at this same Web address.
About Foundry Networks
Foundry Networks, Inc. is a leading provider of high-performance enterprise and service provider switching, routing, security and Web traffic management solutions including Layer 2/3 LAN switches, Layer 3 Backbone switches, Layer 4-7 application switches, wireless LAN and access points, access routers and Metro routers. Foundry's 9,700 customers include the world's premier ISPs, Metro service providers, and enterprises including e-commerce sites, universities, entertainment, health and wellness, government, financial, and manufacturing companies. For more information about Foundry and its products, call 1-888-TURBOLAN or visit www.foundrynetworks.com. |
