The company describes itself as an "enterprise-storage industry leader," which is very different from a commodity memory modules seller, which it was in Circuit City
The new enterprise storage focus rests almost entirely on SSD hopes, although the segment is still in its infancy. The SSD market could reach $10 billion by 2012, so it's no wonder STEC wants to be a leader.
Last night's earnings report showed $53 million in revenue, a year-over-year decrease of 28.7% from the $74 million last year. However, the number was $2 million above management guidance. Non-GAAP earnings numbers landed at the low end of the official forecast, at $0.07 per share.
In the earnings phone call, management sounded guardedly optimistic, and kept pushing the opportunities inherent in three recent major product launches, particularly the ZeusIOPS enterprise-sized SSD. That product produced all STEC's flash-drive sales this quarter, at $7 million, which is up from $5 million in the previous quarter.
STEC hopes to sell many more units as its customers qualify SSDs for production use. EMC
So STEC believes that it is the market leader in this nascent field, aside from shipping traditional memory modules for inclusion in end-user systems from the likes of Hewlett-Packard
If $7 million in quarterly sales makes a market leader, perhaps it's best to stay out of the SSD race for a while, until it becomes more obvious who'll come out on top. Of course, STEC, Smart Modular, and Micron all have taken a beating in the market in the past year, so if you believe in their technology, none of the stocks are particularly expensive today.
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