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Fusion IO reports $20m loss and buys Nexgen

Reveals falling sales and widening losses
Thu Apr 25 2013, 12:05

FLASH STORAGE VENDOR Fusion IO has reported a $20m loss for its fiscal third quarter, while also announcing its purchase of rival storage vendor Nexgen.

Fusion IO was one of the first storage vendors to pitch solid-state disk (SSD) drives in the datacentre, long before established vendors decided to look into the technology. Despite the firm's first-mover advantage its financial results make for grim reading, with revenue down seven percent to $87.6m and a widening loss of $20m for the firm's fiscal third quarter.

Fusion IO CFO Dennis Wolf touted the firm's most recent business, saying, "This past quarter we had four customers, each order in excess of $5m and twelve customers, each order more than $1m in verticals ranging from cloud services to telecommunications to the public sector."

Despite Wolf's claim of new business the firm's revenues fell, with its deferred revenue and cash on hand both falling.

Looking past Fusion IO's lacklustre bottom line, the firm announced that it will buy rival storage vendor Nexgen for $114m in cash and $5m in stock, hoping to attract business from the lucrative small business market. Nexgen's storage products use commodity x86 hardware and Fusion IO said that its Iomemory and Iocontrol products along with Nexgen kit are well suited to small businesses.

David Flynn, Fusion IO CEO and chairman said, "The hybrid Nexgen solution combines memory attached flash and disk on leading server platforms to provide a system tuned to deliver performance, price and capacity.

"With this acquisition, we will maintain the current Nexgen product model as we transition to supporting customers' preferred server platforms with our OEM partners."

Fusion IO forecast that its full-year fiscal 2013 revenue will be around $435m. µ


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