Aruba Posts Loss, Will Cut Staff

The wireless LAN vendor posted increased revenue, but its $6.4 million loss is making it join the long list of companies that will be cutting jobs.

Marin Perez

November 21, 2008

1 Min Read
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Aruba Networks saw its revenue rise for the first fiscal quarter, but the wireless LAN vendor still posted a loss of $6.4 million, an increase from last year's $639,000 loss for the same period.

For the quarter ending Oct. 31, Aruba reported revenue of $52.4 million, up 12% from the same period a year ago. The company also said it added 700 new customers, bringing the total to 6,000.

But the company could not escape the economic downturn, and Aruba said it will reduce operating costs by about 10% by restructuring and cutting an unspecified number of jobs. Aruba joins the long list of tech companies that are cutting jobs, including Sun Microsystems, Hewlett-Packard, Sony Ericsson, and Nokia.

"Entering our second quarter, we remain cautiously optimistic about our year-over-year growth prospects even in the tougher economy," said Dominic Orr, Aruba's CEO, in a statement. "At the same time, we are refocusing our efforts to improve our profitability and believe that we can achieve greater operating leverage by examining costs throughout our business."

The restructuring will cost about $1.2 million in the next quarter, Aruba said. The company said it's well-positioned to help companies weather the economic downturn because its products can help enterprises realize savings by maximizing the productivity of their legacy wireless equipment. In particular, the education market remains a strong vertical for Aruba, and the company said retail and government sectors should provide growth opportunities.

The company said it's in a strong position financially, and it continues to show improved operating leverage.

"We ended the quarter with $108.2 million of cash and short-term investments, representing a $6.5 million increase on a sequential basis, and we have zero debt," Aruba CFO Steffan Tomlinson said in a statement.

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