(WEB HOST INDUSTRY REVIEW) — While it may not seem like much, enterprise network provider Aruba Networks (www.arubanetworks.com) has reported second quarter earnings of $0.02 per share, with revenues of $47.6 million, exceeding pundit expectations it would merely break even, however, the third quarter may be less cheery according to technology and communications analysis firm Signal Hill (www.signalhill.com).
According to Signal Hill’s Friday announcement, Aruba will likely see a slow down in January orders due to customer budget delays before picking-up again in April.
Aruba provides networks that integrate with existing enterprise networks, effectively offering outsourced wireless local area networks, application continuity services, and identity-based security in a unified system.
Last week, the US Patent and Trademark Office issued a preliminary re-examination report rejecting twelve of Motorola’s fourteen claims asserted against Aruba Networks by Motorola in 2007. Signal Hill noted that recent rulings from the USPTO’s patent review make Aruba’s standing in its lawsuit with Motorola seem “extremely favorable.”
Because analysts expect the lawsuit to turn to its favor and enterprises are rapidly outsourcing their wireless networking, Signal Hill recommends investors to buy Aruba stocks because, despite a rough patch at the beginning of the year, the company’s prospects look good in the long run.
“We believe Aruba is the technology leader and is gaining market share in the WLAN equipment market,” Signal Hill stated in a research note. “Wireless networking is a fast-growing technology that provides a number of advantages to enterprises that are not possible with Ethernet connections. Aruba’s unique solutions and user-centric technology provide critical competitive advantages and strategically position the Company to capitalize on emerging enterprise applications.”
Aruba also licenses and sells products including its ArubaOS operating system, optional value-added software modules, a centralized mobility management system, high-performance programmable mobility controllers, wired and wireless access points, wireless intrusion detection tools, spectrum analyzers and endpoint compliance solutions. In March 2008, it acquired WLAN management software provider AirWave Wireless.
