Shoretel Reports Financial Results for Second Quarter Fiscal Year 2010

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ShoreTel has announced financial results for the second quarter of fiscal year 2010, which ended December 31, 2009.

For the second quarter of fiscal year 2010, revenue was $35.5 million, up 5 percent sequentially from the first quarter of fiscal 2010 and up slightly from the second quarter of fiscal year 2009. GAAP net loss was $(2.5) million, or $(0.06) per share, compared to a GAAP net loss of $(2.3) million, or $(0.05) per share, reported in the second quarter of fiscal 2009. Excluding stock-based compensation expenses of $2.8 million and related tax adjustments, non-GAAP net income for the second quarter of fiscal year 2010 was $0.3 million, or $0.01 per diluted share, compared to non-GAAP net income of $0.2 million, or $0.01 per diluted share, reported in the second quarter of fiscal year 2009.

GAAP gross margins for the second quarter of fiscal year 2010 were a record 64.5 percent, compared with 63.1 percent during the same quarter last year. GAAP gross margins in the second quarter of fiscal year 2010 included $0.3 million in stock-based compensation charges. Non-GAAP gross margins, which exclude stock-based compensation charges, were an all-time high of 65.3 percent in the second quarter of fiscal year 2010, up from 63.8 percent in the year-ago quarter.

As of December 31, 2009, the company had $115.0 million in cash, cash equivalents and short-term investments, its highest level in company history. The company generated approximately $3 million in cash flow from operations during the quarter.

“We are seeing solid growth and an improving market even before the benefits of our strategic investments in sales, R&D, and branding are realized. We are very pleased with our second quarter performance, having outperformed our revenue and earnings expectations, posted our all-time highest gross margins, and grown our cash and short-term investments by $3.5 million while making significant investments in our business. We also achieved double-digit growth from our national partners, and signed over 800 new customers. Looking forward, we expect to build on this positive momentum,” said John W. Combs, chairman and chief executive officer of ShoreTel. “Our strong second quarter combined with forecasted growth for our industry reinforces the fact that we chose the right time to make these strategic investments in our business.”