SolarWinds Raises N-able Revenue Expectations for 2H 2013
Although SolarWinds (SWI) overall Q2 2013 revenues fell short of expectations, the company’s recent N-able Technologies acquisition delivered record June results. Plus, SolarWinds predicts N-able’s revenues for June 2013 to December 2013 will be about $2.5 million to $4.5 million higher than previously expectations. CEO Kevin Thompson also praised the N-able management team during an earnings call on July 25. Here are the details.
During the earnings call, Thompson said N-able grew bookings 48 percent in June 2013 vs. June 2012. He also said SolarWinds will accelerate the integration of new features and functions into N-able’s cloud platform for managed services providers (MSPs). He indicated that N-able should deliver strong upside for the long haul at SolarWinds.
Total revenue from N-able during the quarter was $1.7 million — but I believe that figure only represents June (not April and May). The $1.7 million figure exceeded SolarWinds’ original N-able outlook of $700,000 to $800,000, the company indicated during the earnings call. N-able had strong bookings and strong renewals and maintenance, SolarWinds indicated.
In fact, SolarWinds expects N-able’s revenues for June to December 2013 to be $11.5 million to $12.5 million, vs. prior outlook of $8 million to $9 million, the company said on the earnings call. Read between the lines, and N-able leaders like JP Jauvin and Mike Cullen will be working incredibly hard to meet SolarWinds’ increased revenue targets for the business. But it sounds like SolarWinds is confident the N-able team is up to the challenge.
During the earnings call, Thompson said: “The good thing about N-able, we got a really solid management team in that N-able acquisition. That team knows what they’re doing. They’ve been successful for the last couple of years. They don’t need our help to be successful. We are providing some expertise about what we do and we’re partnering a lot on the technology front…”
Thompson also hinted that SolarWinds might look for some tuck-in acquisitions to further bolster the N-able or SolarWinds businesses. “If we buy something don’t be surprised. If we don’t, don’t be surprised either.”
So what went wrong in Q2? Thompson indicated that a SolarWinds sales slowdown in EMEA (Europe Middle East, Africa) was too much for the company to overcome during the quarter. SolarWinds shares fell about 20 percent during after hours trading on the news.