Silicon Graphics 4Q Misses the Street; 2011 View Reaffirmed

Silicon Graphics International (NASDAQ:SGI) reported worse-than-anticipated fourth-quarter results, but the company reaffirmed its full-year fiscal 2011 forecast, which was above expectations.

The server and data-storage solution firm backed its previous forecast for break-even earnings on a per-share basis in fiscal 2011, on revenue between $550 million and $575 million for the full-year. The company expects gross margin to come in between 27% and 30% in the next fiscal year. The view  handily topped analyst views, as the Street was looking for a fiscal 2011 loss of 12 cents a share on revenue of $563.34 million.

In the fiscal fourth quarter, the company reported a loss of 91 cents a share, compared with last year’s fourth-quarter loss of 2 cents a share. On an adjusted basis, the company saw a fourth-quarter loss of 55 cents, an improvement from last year’s adjusted fourth-quarter loss of 62 cents a share.

Adjusted revenue rose to $122.2 million, compared with year-ago sales of $60.5 million.

The results missed analyst estimates, as the Street had predicted a fourth-quarter loss of 27 cents a share on revenue of $126.97 million, according to a poll by Thomson Reuters.

Gross margin widened to 19.3%, compared with 8.7% in the fourth-quarter of 2009, but was narrower than last quarter’s margin of 26.8%.

"Fiscal 2010 was a transformative year for SGI with many successes," said SGI CEO Mark J. Barrenechea, in a release. "We focused on completing the integration, delivering innovative products to market and making investments in key areas that will serve as a foundation for future growth. Further, we have strategically focused the company on the $9 billion technical computing market, where we have begun to emerge as a trusted partner."

The company also said it will resume its $40 million stock buyback plan.

Shares of Silicon Graphics fell four cents or half a percent in Tuesday’s session, closing the day at $5.92.  The stock was up 2 cents or in after-hours trading.