ATCA/Standard Servers

RadiSys Lowers Q4 Forecast

HILLSBORO, Ore. -- RadiSys® Corporation (NASDAQ:RSYS - News), a leading provider of innovative hardware and software platforms for next generation IP-based wireless, wireline and video networks, today announced that it anticipates its revenue and earnings for the fourth quarter ending December 31, 2010 to be lower than its previously stated guidance. Fourth quarter revenue is now expected to be between $62 and $64 million, down from the previous guidance of $68 to $72 million. The Company expects a GAAP fourth quarter net loss of between $0.15 and $0.20 per share, down from the prior guidance of breakeven to net income of $0.05 per diluted share. Non-GAAP fourth quarter results are expected to be between net income of $0.01 per diluted share and a net loss of $0.02 per share, down from the prior guidance of net income of $0.12 to $0.17 per diluted share. GAAP expectations per share assume an effective tax rate of 10% and non-GAAP expectations per share assume an effective tax rate of 40%. In addition, the fourth quarter GAAP projected results include an estimated restructuring charge of $1.7 million that was not included in the previous guidance, for employee-related expenses associated with ongoing reductions to simplify the Company’s operational infrastructure and to reduce the legacy business cost structure.

Commenting on the revised guidance, Scott Grout, RadiSys President and CEO stated, “While much of our business is performing well relative to our original fourth quarter guidance, we recently received news that our projected fourth quarter revenue with a large North America media server end customer is expected to be significantly lower. Specifically, our end customer reprioritized their capital expenditures in the quarter and removed a planned set of media server feature enhancements from their fourth quarter deployment programs. We have a long term deployment history with this end customer and expect that both feature and capacity upgrades will continue to be a key part of their plans going into 2011 and beyond. We have had a strong track record of meeting our quarterly guidance, so while I’m very disappointed with lowering guidance for the quarter, we believe that our longer-term growth prospects for this particular customer program and our next generation communications business remain very good.”

Radisys Corp. (Nasdaq: RSYS)

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