SAN JOSE, Calif., April 28 — Extreme Networks, Inc. (Nasdaq: EXTR) has released financial results for its fiscal third quarter ended March 31, 2016.  Third quarter GAAP revenue was $124.9 million and non-GAAP revenue was $125.3 million.  GAAP net loss for the third fiscal quarter was $10.8 million, or $0.10 per basic share, and non-GAAP net income was $3.5 million, or $0.03 per diluted share.

“We posted solid performance for the quarter, achieving 4% year-over-year organic growth and significantly improved non-GAAP profitability, while also strengthening the balance sheet,” stated Ed Meyercord, President and CEO of Extreme Networks.  “Growth was driven by continued penetration of targeted education and hospitality/public venue enterprise customers in North America, and successful execution of our software-driven solutions selling approach for wireless and wired enterprise campus networking.

“Despite the challenging macro environment for enterprise campus switching, which included seasonal pricing pressure, our team made consistent progress in selling the ExtremeManagement, ExtremeControl and ExtremeAnalytics software portfolio combined with our Wave 2 access points and next generation end-to-end switch portfolio powered by Broadcom.  We are encouraged by the growing number of customers who recognize the important benefits of adopting our integrated software and hardware solution, which include lower total cost of ownership, improved network performance and security, and more efficient network management,” Meyercord added.

Recent Key Events:

• Unveiled Wireless Specialization Program. During the quarter, we introduced the ExtremeWireless specialization program to further enable global channel partners to deliver the wireless solutions customers require in order to increase productivity and responsiveness and extend applications beyond the wired network.
• Strengthened the Sales Leadership Team.  We announced the appointment of John Morrison to the position of vice president, EMEA sales and services.  Morrison will oversee EMEA sales, services and strategy.  In addition, we announced the appointment of Gordon Mackintosh to the position of senior director of worldwide partner program and sales business development. In this role, Mackintosh is responsible for the ongoing development of the Extreme Partner Network to provide the company’s global partner ecosystem with new revenue streams and growth opportunities.
• Partnership with the NFL. To further measure and analyze the fan experience, the NFL leveraged ExtremeAnalytics as part of Extreme Networks’ role as the Official Wi-Fi Analytics Provider of Super Bowl 50. We also provided our ExtremeWireless solution to Super Bowl City in the San Francisco Bay area, where over 100 Wi-Fi Coaches assisted fans with their wireless needs to enhance their game day digital experience.
• Key Customer Wins in Focus Markets. Extreme Networks continued to showcase customer momentum.  Notable customer wins in key vertical markets include:
  • Education: Sinclair Community College, Slippery Rock University, Letcher County Schools, Grant County Schools, Valdosta City School District
  • Healthcare: Hunterdon Healthcare System, Basildon & Thurrock University Hospitals NHS Trust, Charitè Universitätsmedizin Berlin, Barco
  • Manufacturing:  Volkswagen, Schneider Electric
  • Hospitality: UOA Vertical Hotel Bangsar, The Kraft Group – New England Patriots, Carolina Panthers, Buffalo Sabres, Chicago Cubs
  • Government:  The United States Department of Health and Human Services, Commonwealth of Massachusetts – Port Authority, Perth & Kinross Council, Republic of Turkey – Ministry of Interior, Ankara Metropolitan Municipality Water and Sewerage, City of Memphis
  • Additional customers include:  SAK Holding, Reed Smith Shaw & McClay, GasLINE GmbH & Co. KG, Nokia

Business Outlook

For its fourth quarter of fiscal 2016 ending June 30, 2016, the Company is targeting GAAP revenue in a range of $136.6 million to $146.6 million with non-GAAP revenue in a range of $137.0 million to $147.0 million. GAAP gross margin is targeted between 50.5% and 52.3% and non-GAAP gross margin is targeted between 53.5% and 55.0%. Operating expenses are targeted to be between $71.6 million and $73.6 million on a GAAP basis and $63.5 million to $65.5 million on a non-GAAP basis. GAAP earnings are targeted to be between a net loss of $4.2 million to net income of $1.0 million, or a loss of $0.04 to net income of $0.01 per share.  Non-GAAP earnings are targeted in a range of net income of $8.1 million to $13.3 million, or $0.08 to $0.12 per diluted share. The GAAP and non-GAAP net income (loss) targets are based on an estimated 105 million and 107 million average outstanding shares, respectively. Targeted non-GAAP earnings exclude expenses related to stock-based compensation expense, the amortization of acquired intangibles, acquisition and integration related expenses, restructuring expenses, litigation expenses, overhead adjustments and the purchase accounting adjustment related to deferred service revenue.

About Extreme Networks

Extreme Networks, Inc. (EXTR) delivers software-driven networking solutions that help IT departments everywhere deliver the ultimate business outcome: stronger connections with customers, partners and employees. Wired to wireless, desktop to datacenter, we go to extreme measures for our 20,000-plus customers in more than 80 countries, delivering 100% insourced support to organizations large and small, including some of the world’s leading names in business, education, government, healthcare, manufacturing and hospitality. Founded in 1996, Extreme is headquartered in San Jose, California. For more information, visit Extreme’s website or call 1-888-257-3000.

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Source: Extreme Networks