Compellent: Fiscal 2Q08 Financial Results

Compellent Technologies, Inc. announced its financial results for the second quarter ended June 30, 2008. Revenue for the second quarter of 2008 was $21.0 million, up 74 percent from $12.1 million in revenue for the second quarter of 2007, and an increase of 15 percent from the first quarter of 2008. This represents the eleventh consecutive quarter of sequential revenue growth.

Gross margin was 54.1 percent, an increase of 6.3 percentage points from the second quarter of 2007 and 1.9 percentage points from the first quarter of 2008. Net loss was $603,000, or $(0.02) per share, for the second quarter of 2008 compared with a net loss of $1.9 million, or $(0.45) per share, for the second quarter of 2007.

For the first six months of 2008, revenue totaled $39.3 million, an 88 percent increase from $20.9 million through the first six months of 2007. Net loss was $2.2 million, or $(0.07) per share in the first half of 2008 compared with a net loss of $4.1 million, or $(0.95) per share, for the same period in 2007.

“We continue to generate robust growth in revenue, new end user additions, and increased margins despite the slowdown of IT spending in the U.S.,” said Phil Soran, president and CEO of Compellent. “Demand for our cost-effective and energy efficient storage remains strong, driven by our ability to offer sophisticated data management, protection and recovery features typically required by large enterprises to a broad range of customers.”

Additional recent highlights include:

Product revenue totaled $17.0 million in the second quarter of 2008, a 67 percent increase from the second quarter of 2007. Product support and services revenue was $4.0 million in the second quarter, a 113 percent increase from the same period in 2007.
Sales to new customers represented 59 percent of product revenue for 2008, while the existing customer base represented 41 percent.
Current and long-term deferred revenue increased to $15.6 million at June 30, 2008 compared with $12.5 million at March 31, 2008 and $10.5 million at December 31, 2007.
Cash and investments totaled $92.9 million at June 30, 2008.
The company had 972 end users at June 30, 2008 compared to 740 at December 31, 2007.

Since its public offering in October 2007, the company has achieved significant milestones including:

• Completed its eleventh quarter of consecutive revenue growth.
• Announced the 1000th end-user customer.
• Microsoft named Compellent its 2008 Partner of the Year for Advanced Infrastructure Solutions, an important validation of the company’s efforts to optimize virtualized storage for Windows environments.
• Received notification of the issuance of Compellent’s first two patents on data progression and instant replay technologies in July.
• Compellent’s all-channel sales network expanded into 23 countries and the company is rapidly gaining momentum with new channel partners worldwide.

“We continue to make steady progress to profitability with advances on both the technology side and through business execution. We have matured nicely and gained significant acceptance in the market,” Mr. Soran concluded.