Advertisment

VA Linux to suffer larger loss

author-image
CIOL Bureau
Updated On
New Update

VA Linux Systems, the premier Linux server company continues to suffer from a

string of quarterly losses despite strong revenue growth. VA Linux said the

slowing economy has caused its loss for the current second quarter of fiscal

2001 to be larger than expected. A year ago, VA lost $11.6 million on $20.2

million in sales. The present quarter’s sales are expected to be in the $40-50

million range.

The company’s shares are trading at $9 a share. When it wen public in 1999,

the shares shot up from $30 to $310 on the first day of trading, setting a stock

market record. The issue has been going down almost ever since as investors have

lost their appetite for Linux-oriented stocks.

Company CEO Larry Augustine said that the overall economic slowdown is

hurting sales of all of VA Linux's products, from Linux servers to banner

advertisements on the company's Web sites. Sales growth has also taken a hit.

Instead of an earlier forecast of 120 per cent sales growth in 2001, VA is now

forecasting an overall 60 per cent improvement.

tech-news