SUNNYVALE, Calif., Jan. 6, 2015 /PRNewswire/ -- Meru
Networks, Inc. (NASDAQ: MERU), a leader in intelligent
networking and the only wireless LAN vendor to have received
OpenFlow™ conformance, today announced preliminary results for the
fourth quarter of 2014. Based on preliminary financial
information, Meru anticipates fourth quarter revenues of
approximately $21.0 million to $22.0
million, which is below the previously announced guidance
range of $23.0 million to $27.0
million.
In addition, Meru announced a restructuring of the Company
designed to reduce breakeven from approximately $27.0 million in quarterly revenues to
approximately $21.5 million to $22.5
million by the end of the first quarter of 2015, with target
gross margins at 62.5%. Meru expects to incur restructuring and
one-time charges of approximately $1.5
million to $2.0 million in the first quarter of 2015. The
restructuring is expected to impact every department across all
geographies, and is expected to reduce headcount by more than 10%
of the full-time employees along with approximately 20 contractors
in the first quarter of 2015. The restructuring consolidates
certain functions and flattens the organization while reducing
operating expenses and cash burn, and accelerates a return to
operating profitability.
Meru has a number of new initiatives that are well aligned with
current market interests. These include high performing 11ac
products and the recently introduced 11ac wall plate solution,
increased software content through Meru Center and Meru App Store, the controller-less cloud
subscription model for SME, and SDN/OpenFlow unified wired-wireless
capabilities. Along with the return of E-Rate funding in the second
half of 2015, we believe these initiatives will act as catalysts
for future growth.
"We are disappointed with this performance, yet believe that our
technology advantages can be converted into greater market
adoption. We are determined to optimize the mix of partners,
channel distribution, and effective direct sales necessary to put
the Company back on a growth track," said Dr. Bami Bastani, President and CEO of Meru. "Today
we have taken a major step in further streamlining the company
structure to accelerate decision making, enhance operational
efficiencies, and reduce breakeven sales to position the Company
for profitability."
Meru has also announced that Kevin
Coppins, the company's Vice President of Sales for
North America, has notified the
company of his resignation from the company, to be effective
January 12, 2015. Tom Palomaki, the company's Vice President of
Worldwide Support and Services, has been appointed to serve as the
company's new Vice President of Sales for North America. "We thank Kevin for his service
and wish him the best in his future endeavors," said Dr. Bastani,
President & CEO, "and we have the highest confidence that Tom
will succeed in his new role. Having previously served as a senior
executive in technology sales for approximately 25 years, Tom has
an exceptional understanding of our customers and we expect him to
drive sales and help execute our growth initiatives."
Meru further announced that it had retained Deutsche Bank as its
exclusive financial advisor to explore strategic options,
including, but not limited to, strategic partnering of its
technology and possible sale or merger of the Company. There
can be no assurance that the Company's exploration of strategic
options will result in a transaction. The Company has not set
a timetable for the completion of this process and does not intend
to disclose further developments unless and until its Board of
Directors approves a specific action or otherwise concludes the
review of strategic options.
Meru will report fourth quarter and full year 2014 results on
Monday, February 9, 2015 after the
market closes. Meru's management will host a conference call to
discuss 2014 results on the same day at 5:00
pm ET (2:00 pm PT).
Date: Monday, February 9, 2015
Time: 5:00 p.m. ET (2:00 p.m. PT)
Dial-in Number: (877) 852-2926
International Dial-in Number: (253) 237-1123
Conference ID: 62184717
The live and archived webcast of the financial results
conference call will also be available at the investor relations
section of Meru's website at http://investors.merunetworks.com.
About Meru Networks
Meru Networks (NASDAQ: MERU) is a leader in intelligent 802.11ac
Wi-Fi solutions delivering uninterrupted user experience for
education, healthcare, hospitality and enterprise. The Meru
open-standards-based architecture is designed to enable unified
management of wired and wireless networks. Its end-to-end
application QoS enables enforceable service-level agreements. Meru
provides top performance and high capacity in high-density
environments. Visit www.merunetworks.com or call (408) 215-5300 for
more information.
©2015 Meru Networks. Meru and Meru Networks are registered
trademarks and the Meru logo is a trademark of Meru Networks, Inc.
in the United States. OpenFlow™ is
a trademark of the Open Networking Foundation.
Investor and Press Contact:
Edward Keaney
Market Street Partners
415-445-3238
ekeaney@marketstreetpartners.com
Cautionary Statement Regarding Forward Looking
Statements
All statements other than statements of historical facts are
statements that can be deemed forward-looking statements, including
any statements of expectations or beliefs. These
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those in
the forward looking statements. Risks and uncertainties that could
cause our results to differ materially from those expressed or
implied by such forward-looking statements include, among others:
business and economic conditions and growth trends in the
networking industry, our vertical markets and various geographic
regions; competition in the industry; our future capital needs may
change; changes in overall information technology spending; failure
to develop new products; and those risks and uncertainties
described in documents filed with or furnished to
the Securities and Exchange Commission ("SEC") by Meru,
including under the caption "Risk Factors" in Meru's Quarterly
Report on Form 10-Q filed with
the SEC on October 30, 2014, and any subsequent
reports filed with the SEC. All forward-looking statements in
this press release are based on information available to Meru as of
the date hereof, and Meru assumes no obligation to update these
forward-looking statements, except as required by law.
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SOURCE Meru Networks, Inc.