Revenues of $560–$590 million
As shown in the graph below, Brocade Communications Systems (BRCD) expects to see revenues in the range of $510 million–$530 million in fiscal 3Q16. The company expects to report a non-GAAP (generally accepted accounting principles) operating margin in the range of 20.5%–22%. EPS (earnings per share) are expected to be in the range of $0.19–$0.21.
Taking the Ruckus Wireless acquisition into account, Brocade expects to see revenues of $560 million–$590 million and a non-GAAP operating margin of 17%–19% in fiscal 3Q16. The company expects to report non-GAAP diluted EPS of $0.14–$0.17 in fiscal 3Q16.
As seen earlier in this series, analysts expect Brocade to report revenues of $573.1 million and non-GAAP EPS of $0.16 in fiscal 3Q16. Analysts also expect revenues of ~$2.3 billion in fiscal 2016, which represents growth of 2.2% YoY (year-over-year).
SAN product revenue expected to fall in fiscal 3Q16
In its SAN (Storage Area Network) business, Brocade expects revenues to fall by 3.5% to 7.5% quarter-over-quarter in fiscal 3Q16, driven by overall weakness in the storage segment. Brocade expects its IP Networking product revenues to rise 7% to 14% quarter-over-quarter in fiscal 3Q16, driven by an increase in US federal revenue.
Driven by “lower overall revenue and the expected mix of SAN and IP revenues,” Brocade expects to report a non-GAAP gross margin of 66.5%–67% in fiscal 3Q16.