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BROCADE COMMUNICATIONS SYSTEMS, INC. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: June 1, 2012 04:22PM

BROCADE COMMUNICATIONS SYSTEMS, INC. (BRCD) filed Quarterly Report for the period ended 2012-04-28. Brocade Comm Sy has a market cap of $2.19 billion; its shares were traded at around $4.47 with a P/E ratio of 12.9 and P/S ratio of 1. Brocade Comm Sy had an annual average earning growth of 15.3% over the past 10 years. GuruFocus rated Brocade Comm Sy the business predictability rank of 2-star.



Highlight of Business Operations:

The increase in Data Storage product revenues for the period was driven by our high-end, higher bandwidth Director products in the three months ended April 28, 2012. The number of ports shipped during the three months ended April 28, 2012 decreased by 2%, offset by an increase of 6% in average selling price per port due to a favorable product mix shift;

The increase in total net revenues for the six months ended April 28, 2012 compared to the six months ended April 30, 2011 reflects higher sales of our Data Storage products, partially offset by lower revenues from our Ethernet products and Global Services offerings.

The increase in Data Storage product revenues for the period was driven by our high-end, higher bandwidth Director and Switch products in the six months ended April 28, 2012. The number of ports shipped during the six months ended April 28, 2012 increased by 1%, and average selling price per port increased by 4%;

A significant portion of our revenues is concentrated among a relatively small number of OEM customers. For the three months ended April 28, 2012, four customers accounted for 20%, 15%, 13% and 10%, respectively, of the Company s total net revenues for a combined total of 58% of total net revenues. For the three months ended April 30, 2011, four customers accounted for 15%, 14%, 13% and 11%, respectively, of the Company s total net revenues for a combined total of 53% of total net revenues. We expect that a significant portion of our future revenues will continue to come from sales of products to a relatively small number of OEM partners and to the United States ("U.S.") federal government and its individual agencies through our distributors. Therefore, the loss of, or a decrease in the level of sales to, or a change in the ordering pattern of any one of these customers could seriously harm our financial condition and results of operations.

As of April 28, 2012, three customers accounted for 20%, 12% and 11%, respectively, of total accounts receivable, for a combined total of 43% of total accounts receivable. As of October 29, 2011, two customers accounted for 16% and 14%, respectively, of total accounts receivable, for a combined total of 30% of total accounts receivable. We perform ongoing credit evaluations of our customers and generally do not require collateral or security interests on accounts receivable balances. We have established reserves for credit losses, sales allowances, and other allowances. While we have not experienced material credit losses in any of the periods presented, there can be no assurance that we will not experience material credit losses in the future.

Read the The complete Report



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