NetScout Systems Inc. F2Q10 (Qtr End 09/30/09) Earnings Call Transcript

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2009-10-22 18:52:07.0

Tags: Telecommunications Company, Call Transcript, Earnings, Cisco Systems Inc., NetScout Systems Inc., Wireless, Telecom & Utilities, Telecommunications, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from the line of Mark Kelleher from Brigantine Advisors. Your line is open.

Mark Kelleher - Brigantine Advisors

I was just wondering if you could dig a little deeper into the wireless opportunity. What are you seeing there? Where are the new products in that development cycle? How much benefit are you seeing maybe if you can quantify from the Cisco relationship on the wireless side and maybe touch on the competition that you are seeing on that sector as well?

Anil Singhal

I’ll say few things and David can add few other things and Michael can add other things to this. On the product front we have made quite a few investments and most of the product is already developed and ready to be used by the customers.

On the competition side, we continue to see the competition from Tektronix and Agilent and host of other vendors. Tektronix being part of Danaher, and I don't think the Cisco relationship is directly tied to our service provider business. We'll be seeing more help from them on the enterprise side.

David Sommers

Mark, this is David. The Cisco relationship has expanded a bit from what we announced earlier in the year, but as Anil said it's not service provider focus, it's enterprise focus and even on the enterprise side, it's yet to any significant of revenue. We expect that to happen over time, but it will take a while.

Operator

Your next question comes from the line of Jonathan Ruykhaver from ThinkEquity, your line is opened.

Jonathan Ruykhaver - ThinkEquity

Congratulations on the execution as it relates to profitability. My question is, David, when you look at the growth targets, what did it implies for revenue in the second half, do those assumptions basically implied at Telco as a percentage booking get back to where it was, let's say, in the third quarter of last year, fourth quarter of last year in the mid-20% range?

David Sommers

Well, Jonathan, we certainly expect Telco to grow. When we talked about lumpiness, we haven't had in the last two quarters a significantly sized Telco deal, and we did have in the last half of last year. So, yeah, it's implied, and that is a return of significant Telco big lumps, and that's not a strategy of hope, we have in them pipeline and we're working on them actively as you would expect.

 

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