Feeds

Lawsuit loot helps Overland cut loss

$3m keeps wolf from door

Security for virtualized datacentres

Overland Storage has reported a reduced quarterly loss, helped by a $3m gain from a lawsuit.

Overland, which supplies NEO physical and REO virtual tape libraries and Snap iSCSI SAN, filer and unified storage products, has reported its second quarter fiscal 2011 results, ending 31 December 2010; both revenue and net loss numbers are down.

Revenues were $17.93m, 12.2 per cent down on the $20.432m reported a year ago, and the net loss was $0.91m ($2.58m a year ago.) That looks impressive. The revenue was two per cent higher than in the previous quarter and the net loss was significantly lower than the $6.5m in the preceding quarter.

However, Overland earned $3m by selling a minority interest in its patent infringement no-win, no-fee lawsuit against tape automation manufacturer BDT. Removing this from the numbers would make the net loss $3.91m, still down on the prior quarter but an increase on the year-ago quarter. It was a good rabbit to pull out of the hat but doesn't relate to underlying product and service sales, being a one-off… but maybe not.

If the lawsuit prospects are good enough for some third party to pay Overland $3m for a minority interest in the outcome, then Overland could reasonably look forward to an award of perhaps $10m or more if it wins the case, giving it a further gain of, say, $5m. Perhaps, with this sale happening, BDT will try to negotiate a settlement.

As its OEM revenues decline Overland is selling more branded product; sales grew 21.7 per cent from the previous quarter and now constitute 92.3 per cent of all sales. The downwards effect of declining OEM revenue on Overland's result will probably end next quarter.

Interestingly sales of NEO tape products in the quarter were 10.7 per cent higher than in the first quarter. There is a view in Overland that the tape market is growing, a counter-intuitive view to many. The company also thinks the tape market is ripe for innovation.

SnapServer and SnapSAN product sales were up 53 per cent quarter-on-quarter and 95 per cent year-on-year.

Meanwhile, an interesting note: Shmuel Shottan has joined Overland's board. This would be a so-what announcement were it not for the fact that he is the chief technology officer (CTO) of hardware-accelerated filer supplier BlueArc, a company that was founded by Overland's CTO and engineering VP Geoff Barrall. Shottan also worked at Snap Appliance, Overland CEO Eric Kelly's old company and one which he was instrumental in having Overland buy in 2008.

Could we be looking at some sort of link between low-end Snap products and the high-end BlueArcs, some sort of technology supply maybe? Or is it just a case of getting more relevant expertise on the board?

Getting back to the results; if Overland continues to make progress it could return to profit. That would be a red-letter day. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
It's Big, it's Blue... it's simply FABLESS! IBM's chip-free future
Or why the reversal of globalisation ain't gonna 'appen
IBM storage revenues sink: 'We are disappointed,' says CEO
Time to put the storage biz up for sale?
'Hmm, why CAN'T I run a water pipe through that rack of media servers?'
Leaving Las Vegas for Armenia kludging and Dubai dune bashing
Microsoft and Dell’s cloud in a box: Instant Azure for the data centre
A less painful way to run Microsoft’s private cloud
Facebook slurps 'paste sites' for STOLEN passwords, sprinkles on hash and salt
Zuck's ad empire DOESN'T see details in plain text. Phew!
Windows 10: Forget Cloudobile, put Security and Privacy First
But - dammit - It would be insane to say 'don't collect, because NSA'
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.