Feeds

Netezza sees explosive growth in Q2

TwinFin upgrade around the corner

The essential guide to IT transformation

Momentum continues to build at data warehousing appliance maker Netezza, which posted 45 per cent growth in the second quarter of fiscal 2011, hitting $63.8m in revenues.

In the quarter, which ended July 31, Netezza brought $3.2m to the bottom line, more than four times the black ink it had in the year ago quarter.

Jim Baum, Netezza's president and chief executive officer, said in a call with Wall Street analysts that the company closed 28 new customers in the quarter had had good traction across all geographies and within the digital media, financial services, telecom, and retail sectors that live by their data warehousing.

One customer kicked in a $14m deal (the company had a $17m deal in the first fiscal quarter). The company added 22 employees in the quarter, and now has a 469 employee workforce; this includes a new development lab in Cambridge, Massachusetts, and additions to the sales and marketing teams.

Netezza had product revenues of $47.3m, up 57.7 per cent, while services sales revenues were $16.5m, up 18.4 per cent. Pat Scannell, Netezza's chief financial officer, said that 81 per cent of revenues came from the existing customer installed base.

The average TwinFin deal size was $1.6m in the quarter, and TwinFin represented 98 per cent of product revenues in the quarter. The old Mustang systems are effectively dead.

Baum said the company had started up a professional services unit in Q2 and has hired someone to run it as well as the initial employees dedicated to the unit.

Netezza's partnership with NEC, which was announced in February and which will see NEC make and sell data warehousing appliances based on Netezza software and FPGA accelerators running inside of NEC servers, has not yielded appreciable revenues yet, but Baum said the project was progressing, NEC added two customers in the quarter, and NEC was building up a pipeline.

The current TwinFin and prior generations of Netezza appliances were based on IBM's servers, and there are no plans to swap out this hardware. NEC has been a reseller of Netezza appliances since 2006, and it merely wants to use its own iron, not IBM's, when it sells into Asia/Pacific accounts. Eventually, however, NEC will sell its InfoFrame DWH Appliance worldwide, potentially pitting the two Netezza appliances against each other in certain geographies.

NEC started selling the InfoFrame DWH Appliance at the end of March. The sales plan is for NEC to push about 150 data warehouse appliances over three years.

Baum said that its sales force is mostly seeing Oracle, Teradata, and IBM in competitive deals, with win rates "very high" against these three and at 100 per cent against other niche players. Oracle's Exadata is not being seen in any higher frequency this year than it was last year, according to Baum, and in a lot of cases it is being pitched as an OLTP engine for consolidating databases, not as a data warehouse. Teradata is pitching its own data warehouse appliances against Netezza's "aggressively," and EMC's acquisition Greenplum has not changed any market dynamics yet.

Netezza has previewed Release 6.0 of its TwinFin software, and Baum said it would be generally available in the third quarter. The software will double the capacity and more than double the performance of Netezza TwinFin appliances without changing any hardware. Netezza is cooking up a high-capacity data warehousing appliance called Cruiser, slated for availability later in the year.

The Cruiser appliance, which will cram 500 TB in a rack and scale to over 10 TB of usable data, is intended to be a backup for TwinFin appliances that is also able to process queries as it sits there, eating replicated data from the live appliances.

As for guidance for the rest of the fiscal 2011 year, Scannell said that Netezza was expecting to boost revenues by 30 per cent on an annual basis, which means, in terms of absolute revenues, quarters that look about like the one Netezza just inked in Q2. That also means the growth will be slowing down as the compares get a bit tougher. ®

Boost IT visibility and business value

More from The Register

next story
Pay to play: The hidden cost of software defined everything
Enter credit card details if you want that system you bought to actually be useful
HP busts out new ProLiant Gen9 servers
Think those are cool? Wait till you get a load of our racks
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
Silicon Valley jolted by magnitude 6.1 quake – its biggest in 25 years
Did the earth move for you at VMworld – oh, OK. It just did. A lot
VMware's high-wire balancing act: EVO might drag us ALL down
Get it right, EMC, or there'll be STORAGE CIVIL WAR. Mark my words
Forrester says it's time to give up on physical storage arrays
The physical/virtual storage tipping point may just have arrived
prev story

Whitepapers

Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Backing up distributed data
Eliminating the redundant use of bandwidth and storage capacity and application consolidation in the modern data center.
The essential guide to IT transformation
ServiceNow discusses three IT transformations that can help CIOs automate IT services to transform IT and the enterprise
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.