December 3rd, 2015 by Adam Armstrong
Violin Memory Misses 3Q Earning & Watches Stock Drop More Than 25%
Following Nimble Storage’s piece last week there is more bad news for startups that have gone public. Violin Memory also missed third quarter earnings and watched its stock sink as a result. Violin’s revenue not only fell short of expectations, it was also lower than it was in the same quarter last year. The revenue was $12.5 million this quarter down from $15.3 million last quarter and $21.7 million this quarter last year. Analysts were looking for $17.2 million.
Image courtesy Yahoo Finance
Violin’s stock has had a rough road since its IPO, see above. Starting out at a little over $7 a share it fell to under a dollar by market close today. It wasn’t just revenue that pushed shareholders to sell. The company also reported a non-GAAP net loss of $0.19 per share and a GAAP net loss of $0.23 per share. These poor numbers combined with its overall poor trading history aren’t going to make it a very attractive option for investors looking for long-term growth.
As with Nimble, this can be both good and bad in the industry. Startups may either be reluctant to go public, not be able to as easily find investors, or fail to raise much capitol from going public. It may even force the smaller guys to go looking for a buyer, which of course is good news for the big vendors that are looking for certain aspects to add to their product line.