Dot Hill: Preliminary Fiscal 2Q15 Financial Results

Dot Hill Systems Corp. has updated its guidance for the second quarter of 2015.

Management now expects second quarter non-GAAP net revenue and non-GAAP EPS to be $60.4 to $60.8 million and around $0.06, respectively, compared with the second quarter of 2015 guidance provided in May 2015 of $58 to $62 million and $0.04 to $0.08, respectively.

This represents non-GAAP revenue and non-GAAP EPS growth of 24-26% and around 200% respectively, as compared to the second quarter of 2014. The company also notes that its Server OEM and Vertical Markets businesses are expected to grow about 30% and 20%, respectively, on a year-over-year basis.

“We believe our growth trajectory that began in Q4 2014 continues to be catalyzed by company specific factors, including new customer and product launches and the compelling value and innovation inherent in RealStor 2.0,” stated Dana Kammersgard, CEO. “Despite the subdued economic environment and secular headwinds in the IT and storage sectors, we continue to take share from our competitors as our customers’ product launches progress. In the second quarter, our Server OEM segment experienced exceptional growth derived from both existing and expanding customer relationships, after several quarters of decline. In addition, we are gratified by the continued strength in our historically lumpy Vertical Markets business, particularly after over 60% year-over-year growth in the first quarter.“

“The first half of 2015 picked up where 2014 left off, as we are projecting revenue to increase over 40% in Vertical Markets, over 11% with Server OEMs and over 24% in aggregate, relative to the first half of 2014,” stated Hanif Jamal, CFO. “More importantly, growth is resulting in operating leverage with non-GAAP EPS for the first half projected to be almost three times greater than where we were this time last year. Despite a challenging economic and industry sector outlook, our midyear outlook maintains our confidence in our ability to meet or likely exceed the mid-point of the 2015 guidance ranges provided in March 2015.“