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Brocade: Tough Quarter, Bad Year

Brocade Communications Systems reported mixed financial results today, although execs are planning to boost future revenues with a major push into storage services. (See Brocade Reports Q4, 2005 Results.)

The vendor, which has faced stiff competition from rivals Cisco Systems and McData this year, reported fourth-quarter revenues of $145.5 million, down from $155.6 million in the same period last year, although this figure came in above analyst estimates of $144.19 million.

For the full year, the firm reported annual revenues of $574.1 million, down from $596.3 million in 2004, and below analyst estimates of $575.67 million.

On a GAAP basis, there were no quarterly earnings per share on net income of $1.1 million, compared to 8 cents on $20.3 million in the year ago quarter. Non-GAAP earnings for the quarter were 7 cents on net income of $19 million, down from 8 cents and $20.8 million in the fourth quarter of 2004. Analysts had estimated earnings of 5 cents per share.

The results cap a turbulent 12 months for Brocade. In addition to its year-long sales slump, Brocade has also faced delisting by Nasdaq for failing to file earnings reports on time; been under investigation for the way it accounted for stock options; and been embroiled in trying to get out of a deal to pay former CEO Greg Reyes as a consultant. (See Brocade Notified by Nasdaq , SEC Gets Formal With Brocade, and Brocade Blasts 'Consultant' Reyes.)

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