Brocade's late earnings release raises eyebrows

SAN FRANCISCO Fri Nov 20, 2009 6:25pm EST

SAN FRANCISCO Nov 20 (Reuters) - Brocade Communications Systems Inc (BRCD.O) has pushed its fourth-quarter earnings release to three hours after the close of market on Monday, an unusual move that surprised some analysts and investors.

Most large technology companies report their results and hold their conference calls on the same day.

Analysts were left puzzled by the decision to post the results at 7 p.m. EST (2400 GMT), long after most U.S. traders have left the office. The company said its conference call with analysts will follow at 8 a.m. EST (1300 GMT) on Tuesday.

"They've never done that before," said Robert Baird analyst Jayson Noland, adding that he declined to speculate on why the change had happened. "There are companies that do that every quarter but most don't."

Brocade could not immediately be reached for comment.

Analysts on average expect Brocade to report earnings per share of 13 cents, excluding items, and revenue of $521.09 million for its fiscal fourth quarter, according to Thomson Reuters I/B/E/S. That would compare to 20 cents per share and revenue of 398.50 million a year ago.

The company recently drew a lot of interest from Wall Street when rumors about a possible acquisition by Hewlett-Packard (HPQ.N) drove up the stock. But Brocade shares plunged nearly 13 percent after HP's announcement last week that it would buy 3Com Corp COMS.O.

HP is also scheduled to report quarterly results after the market closes on Monday.

JMP Securities equities researcher Douglas Ireland suggested that Brocade might be trying to avoid an HP clash.

"Everyone who would be listening to the Brocade call will be listening to the HP call instead," Ireland said. "Nobody's going to pay attention to Brocade and ignore HP."

Tobacco makers Philip Morris International (PM.N) and Reynolds American (RAI.N) had conference calls scheduled for the same time this summer, until one finally rescheduled.

With HP buying 3Com, analysts say Brocade is likely to focus on its new relationship with Dell Inc DELL.O.

"They're going to hope to get some of that HP-love that they lost through this Dell story," said Ireland.

But that is not expected to stop investors from raising concerns over the fallout from the HP-3Com deal.

"Questioning from investors will be around what happens, and 'You don't have HP now, does that change your strategy?'" said Jefferies & Co analyst Munjal Shah. "The questioning will be around HP, but at the end of the day the results will matter next week."

While it is unusual for a technology company to report earnings and hold a conference call the next day, public real estate companies see this practice as the rule rather than the exception. Companies from Boston Properties (BXP.N) to Jones Lang LaSalle (JLL.N) to SL Green (SLG.N) all hold their conference calls the day after they release earnings. (Reporting by Ian Sherr; Editing by Tim Dobbyn)

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