Enterasys Forecasts, Names CEO

Enterasys Networks announces executive management changes and preliminary quarterly revenue estimates

April 5, 2002

2 Min Read

PORTSMOUTH, N.H. -- Enterasys Networks, Inc. (NYSE: ETS), a leader in enterprise network solutions, today announced the appointments of William K. O'Brien as interim Chief Executive Officer and Director, and Yuda Doron as President. Mr. O'Brien has assumed overall operating responsibilities and Mr. Doron is focusing primarily on sales execution, partner and customer relationships. Enrique P. Fiallo resigned as Chairman, Chief Executive Officer, and President effective today to pursue other business opportunities. In addition, J.E. Riddle, Vice Chairman and Executive Vice President of Worldwide Marketing, and Jerry Shanahan, Chief Operating Officer have resigned their positions. Mr. Riddle will be assisting new management during a transition period, while Mr. Shanahan will be returning to Ireland pursuant to his original plans. "We are very excited to welcome Bill and Yuda to Enterasys," said Jim Davidson, Enterasys Networks Board of Directors member. "We are operating in a very difficult environment and are confident that they bring with them the wealth of experience, skill sets and leadership abilities necessary to lead the Company successfully through its current challenges." The Company also provided preliminary unaudited revenue estimates for the quarters ended December 29, 2001 and March 30, 2002. Enterasys Networks estimates revenue for the fourth quarter ended December 29, 2001 of approximately $145-155 million. This revised estimate is lower than previous estimates due to revenue recognition issues in the Asia Pacific region and a comprehensive analysis of revenue recognition in the remaining regions of the company. The Company expects to report a loss from operations in the fourth quarter. For the first quarter ended March 30, 2002 Enterasys Networks estimates revenue of approximately $110-120 million. The first quarter revenue estimate reflects continued lengthening of the sales cycle due to difficult market conditions, poor sales execution, and the previously announced Securities and Exchange Commission investigation. The Company also expects an operating loss for the first quarter, and a cash decrease of approximately $70 million. As of March 30, 2002, Enterasys had cash of approximately $260 million which included $70 million of cash transferred from Aprisma Management Technologies Inc. Enterasys Networks Inc.

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