Gigamon estimates first-quarter revenue below Street, shares slump

Mon Apr 7, 2014 4:54pm EDT

Paul Hooper, CEO of Gigamon, gives an interview on the floor at the New York Stock Exchange, June 12, 2013. REUTERS/Brendan McDermid

Paul Hooper, CEO of Gigamon, gives an interview on the floor at the New York Stock Exchange, June 12, 2013.

Credit: Reuters/Brendan McDermid

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(Reuters) - Gigamon Inc (GIMO.N), which makes network traffic management software, estimated lower-than-expected first-quarter revenue, blaming cancellation of a large contract and delays in closing some contracts.

The company's shares fell as much as 21 percent in trading after the bell on Monday.

Gigamon forecast revenue of between $31 million and $31.5 million, below analysts' average expectation of $34.8 million, according to Thomson Reuters I/B/E/S.

The company previously forecast revenue of $34.0 million-$35.0 million.

Santa Clara, California-based Gigamon said it took a $2.3 million inventory charge related to cancellation of the EMEA contract.

The company will report first-quarter results on April 24 after market closes.

Gigamon's shares closed at $26.20 on the New York Stock Exchange.

(Reporting By Lehar Maan in Bangalore; Editing by Sriraj Kalluvila)

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