Aruba Networks Inc F4Q08 (Qtr End 07/31/08) Earnings Call Transcript

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2008-08-28 18:33:12.0

Tags: Aruba Networks

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Ryan Hutchinson from Lazard Capital.

Ryan Hutchinson - Lazard Capital

First a clarification of on a couple of questions; just a clarification for Steffan on the guidance; you talked about, Q1 being $50 million to $52 million, Q2 being a little bit tougher, but if I heard you right I think you expect to continue at sequential revenue growth through the remainder of 2009, is that fair?

Steffan Tomlinson

That is fair and that’s correct.

Ryan Hutchinson - Lazard Capital

Okay great and then just to comment here on the general landscape given the recent activity in the networking and storage markets that we’ve seen, specifically the consolidation in the enterprise wireless LAN market with HP acquiring one of your private competitors Colubris and then Brocade’s announcement to acquire foundry, obliviously they are at a relationship there with Marou, so I guess really the question I’m trying to get at is just have you seen any changes there on the competitive side, has that at all impacted you guys over the last few weeks and do you expect it to in the future?

Dominic Orr

So, let me comment on the two specific acquisitions and also the general competitive environment. HP ProCurve and Aruba really do not overlap; they are strong in the mid-year and the SOHO channel and I think that SOHO and Colubris will give them an extended portfolio in that area. The HP enterprise sales forces currently do not overlap with the HP ProCurve channel, so that is no impact to us.

Our perception and understanding of the Brocade foundry mergers driven primarily, almost exclusive in the datacenter issue, so we have not seen any impact at all to our sales momentum at the actual network and in general I would say the orders consolidation actually clear up the marketing noise. I think when you get onto the deal which is emerging more and more then Aruba is clearly perceived as the alternative to Cisco, we get invited and sit at the table more frequently than ever at this moment.

Ryan Hutchinson - Lazard Capital

And then one final one from me; just on the retail and government wins you referenced in the prepared remarks, just a general sense in terms of size, what the typical deployment for these wins looks like you think over the next couple of quarters and then the impact that I’d think that the retail wins could have potentially on your gross margins given that they still remain at the high-end of your target model?

 

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