Rackable Systems this week announced its financial results for the first quarter of fiscal year 2009.
The ecological server and storage product provider reported Q1 revenue of USD $44.4 Million, up 14 percent sequentially, including delivery of two ICE Cube containerized data centers.
Total revenue for the first quarter ending April 4, 2009, was USD $44.4 million, compared to USD $38.8 million for the fourth quarter of 2008 and USD $67.8 million in the first quarter of 2008.
Mark J. Barrenechea, president and CEO of Rackable Systems, said he was pleased with its revenue and working capital progress quarter over quarter.
But he admitted dissatisfaction with the overall results.
"Although the economic turmoil will remain a challenge in 2009, we are focused on accelerating innovative products to market, controlling expenses and completing the acquisition of Silicon Graphics’ assets, enabling us to achieve better gross margins and customer diversification," he said.
Rackable Systems ended the first quarter of 2009 with USD $181.2 million in cash, cash equivalents, long-term and short-term investments, compared to USD $180.6 million at the end of last quarter.
The company’s lower gross margin was attributed to three factors:
- reducing high-cost inventories of certain components through aggressive pricing
- the significant revenue mix of our large Internet data center business
- increased competitive pressure from various server vendors offering aggressive deals during the quarter
Rackable Systems has received court approval to acquire substantially all the assets of Silicon Graphics, Inc. for USD $42.5 million in cash, plus the assumption of certain liabilities associated with the acquired assets.
The acquisition is anticipated to be completed by approximately in May subject to the satisfaction of closing conditions.