Global market intelligence firm IDC estimates that the enterprise flash market will grow to $4.5 billion by 2015. Earlier this year, a Morgan Stanley analyst, Katy Huberty, projected a much stronger growth path. She believes that the enterprise flash market will grow from $2 billion to $20 billion over time. She, however, did not specify the time period over which the market will see such growth.
Enterprise flash market player, Fusion-io, (NYSE: FIO) reported Q3 revenues grew 40% over the year to $94.2 million, ahead of the market’s target of $85.4 million. EPS of $0.06 also beat the Street’s projected earnings of $0.02 per share.
Fusion is focused on diversifying its customer base away from Facebook and Apple. Together, the two customers accounted for 55% of revenues during the quarter. A year ago, the two were bringing in 72% revenues for Fusion. According to recent reports, Fusion may be in talks with Cisco to supply memory cards for Cisco’s servers. It is anticipated that Cisco may account for 10% of Fusion’s revenues within a year.
For the current quarter, Fusion has projected revenues to be flat sequentially, ahead of the Street’s estimate of $88.3 million. Fusion estimates fiscal 2012 revenues to grow 75% over the previous year, compared with market projections of 70% growth.
Fusion-io’s Expanding Products
Fusion-io continued to build on its product offerings and recently launched the first software development kit to provide software developers with native access to the ioMemory flash platform. The kit will help integrate applications directly with the persistent memory tier, thus giving developers the ability to optimize enterprise, Web and big data applications through direct access to the ioMemory computing layer. Analysts believe that developers’ direct access to the ioMemory computing layer is a big step in the market as it significantly simplifies integration issues.
The company is working on the launch of Fusion ioFX, a new ioMemory-based workstation accelerator for digital artists. The memory tier provides the high throughput needed to for real-time content creation. Fusion is working with Adobe to create a new generation of post-production software that will be optimized to work with the new ioFX workstation product. The Adobe enhancements will facilitate tighter integration between applications and the ioMemory architecture of the ioFX to accelerate Adobe’s Creative Suite 6 software components. The move will enable simpler and faster media composition.
Fusion’s stock is trading at $21.13 with a market capitalization of $1.9 billion. It touched a high of $41.74 in November 2011.