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OEMs Prop Up Dot Hill, Engenio

Two players in the midrange SAN system market, Dot Hill Systems Corp. (Nasdaq: HILL) and Engenio Information Technologies Inc., are showing upticks in OEM sales, pointing to a positive industry trend -- though further growth for each could depend on gaining even more deals.

Dot Hill and Engenio are among the suppliers that provide systems to leading SAN system vendors. Dot Hills major business is supplying low-end SAN systems to Sun Microsystems Inc. (Nasdaq: SUNW), while Engenio gets most of its revenues from midrange systems sold to IBM Corp. (NYSE: IBM).

Dot Hill today reported revenues of $69.6 million and net income of $6.7 million, or $0.15 per share, for last quarter (see Dot Hill Exceeds Q2 Guidance). Revenue was up 44 percent over the same period last year and 43 percent from last quarter. According to Reuters, analysts’ estimates for Dot Hill were $58.2 million in revenues and $0.10 earnings per share.

Sun accounted for 87 percent of Dot Hill's total revenues.

Engenio, still part of LSI Logic Corp. (NYSE: LSI) but expected to price its IPO later this week or next, listed revenues of $113.3 million last quarter and net income of $4.6 million, or $0.09 EPS in a statement filed with the SEC(see Engenio Might Wait on IPO, LSI's Storage Sub Plans IPO, and LSI Storage Becomes Engenio). The revenue increased 13 percent from the same quarter last year, although it dropped $2.5 million from the previous quarter.

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