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Isilon Announces 2007 Results

SEATTLE -- Isilon Systems (NASDAQ: ISLN) today announced its financial results for the fiscal year ended December 30, 2007, including the third and fourth quarters of 2007. Isilon also announced that its Audit Committee has concluded its independent review of the timing and treatment of revenue recognition and the Company has completed the restatement of financial statements for certain previous periods. The Company filed its Quarterly Report on Form 10-Q for the third quarter of 2007 and its 2007 Annual Report on Form 10-K with the Securities and Exchange Commission ("SEC").
Isilon today reported that revenue for the 2007 fiscal year was $89.0 million. Revenue for the third and fourth quarters of 2007 was $21.6 million and $26.6 million, respectively.
Restatement of Prior Period Financial Statements
The Audit Committee, assisted by independent forensic accounting and legal advisors, has completed its review of the Company's prior revenue recognition practices. The Board of Directors, based on the recommendation of the Audit Committee, concluded that the Company should restate its financial statements for the fourth quarter and fiscal year ended December 31, 2006, and for the first and second quarters of fiscal 2007 ended April 1, 2007, and July 1, 2007, respectively. A detailed description of the Audit Committee's findings and of the restatement are included in the Company's 2007 Annual Report on Form 10-K that was filed today.
As a result of the Audit Committee's review, the Company identified errors in its previous recognition of revenue. To correct these errors, $7.0 million of the $67.4 million of revenue previously recorded from the fourth quarter of 2006 through the second quarter of 2007 has been adjusted. Of the $7.0 million of adjusted revenue, $4.0 million was reversed and will not be recorded as revenue in any future period. The remaining $3.0 million of the adjusted revenue was reversed, with $0.5 million and $1.5 million recognized as revenue in the third and fourth quarters of 2007, respectively, and the remaining $1.0 million expected to be recognized as revenue in fiscal 2008.
Isilon Systems Inc.