3Par: Fiscal 3Q10 Financial Results

3PAR reported results for the third quarter of fiscal year 2010, which ended December 31st, 2009. Revenue for the third quarter was $50.1 million, an increase of 4% compared to revenue of $48.2 million for the same period a year ago and an increase of 9% compared to $46.1 million in the prior quarter, which ended September 30th, 2009.

For the third quarter of fiscal 2010, GAAP net loss was $528,000, or ($0.01) per share, compared to GAAP net income of $461,000, or $0.01 per share, for the same period in the prior year. Non-GAAP net income, which excludes the impact of stock-based compensation expense, for the third quarter of fiscal 2010 was $1.9 million, or $0.03 per share, compared to $2.3 million, or $0.04 per share, for the same period in the prior year.

"Through unique hardware and software innovations such as our newly-announced, hardware-accelerated thin software technologies (Thin Conversion, Thin Persistence, and Thin Copy Reclamation), 3PAR has continued to move the goal posts forward, ahead of the incumbents, widening the gap between the value that legacy storage vendors promise and the value that we actually deliver," said David Scott, President and Chief Executive Officer. "We have continued to stay ahead of the game with first-to-market technologies such as autonomic storage management for clusters, as well as autonomic storage tiering within high-end arrays. This technology leadership has created a strong incentive for customers to choose a best-of-breed approach over the sub-optimal, proprietary, vertical stacks offered by legacy storage vendors."

Additional Third Quarter Fiscal 2010 Financial Information
3PAR reports operating income (loss), net income (loss), and earnings (loss) per share (EPS) on a GAAP and on a non-GAAP basis, which excludes the impact of stock-based compensation expense. The non-GAAP measures are described in greater detail below and are reconciled to the corresponding GAAP measures in the accompanying financial tables.

• GAAP operating loss for the third quarter of fiscal 2010 was $474,000 compared to $667,000 in the second quarter of fiscal 2010. GAAP operating loss was 1% of revenue in both quarters. Non-GAAP operating income in the third quarter of fiscal 2010 was $2.0 million compared to $1.7 million in the second quarter of fiscal 2010. Non-GAAP operating income was 4% of revenue in both quarters. GAAP net loss for the third quarter of fiscal 2010 was $528,000 compared to $758,000 in the second quarter of fiscal 2010. Non-GAAP net income in the third quarter of fiscal 2010 was $1.9 million, compared to $1.6 million in the second quarter of fiscal 2010.
• GAAP EPS for the third quarter of fiscal 2010 was ($0.01) on 61.9 million basic and diluted shares outstanding, compared to ($0.01) in the second quarter of fiscal 2010 on 61.7 million basic and diluted shares outstanding. Non-GAAP EPS in the third quarter of fiscal 2010 was $0.03 on 64.4 million diluted shares outstanding compared to $0.03 on 64.1 million diluted shares outstanding in the second quarter of fiscal 2010.
• Non-GAAP operating income, non-GAAP net income, and non-GAAP EPS are computed net of stock-based compensation. In the third quarter of fiscal 2010 the charges related to stock-based compensation were $2.5 million compared to $2.4 million in the second quarter of 2010.