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Quantum expects video to fast-forward StorNext adoption

Quantum turned a small profit last quarter, and its CEO said he is confident the vendor has turned the corner thanks to its StorNext technology.

Quantum’s $135.1 million revenue was at the high end of its forecast. It was up only three percent from last year, but scale-out storage (StorNext file management and Lattus object software) revenue increased 58 percent year-over-year.

Revenue from DXi backup deduplication appliances grew 11 percent from last year. DXi and StorNext revenue combined for $47 million, helping the vendor ride out declines in tape revenue to record a GAAP profit of $1.2 million. That’s compared to a loss of $7.9 million in the same quarter last year.

Scale-out storage revenue was $25.5 million with disk backup at $21.2 million.

“I don’t think this is a blip for us at all,” CEO Jon Gacek said in an interview after the earnings call.  “It’s a nice start for something that will get much bigger.”

Gacek said StorNext is selling well in media and entertainment markets, and the vendor has just begun to move into other high-capacity storage markets such as video surveillance and corporate video. He said Quantum closed a deal with a sports broadcaster for $2 million last quarter, and had other deals more than $200,000 apiece.

DXi sales also benefited from the latest version of StorNext. StorNext 5 is the underlying file system for the  DXi 6900 enterprise appliances, and Gacek said that has boosted performance and allows customers to use less hardware than previous DXi versions. He said the  DXi 4700 midrange appliances also spiked in revenue last quarter.

Gacek forecasted revenue of $145 million to $150 million for this quarter. He expects the new video markets, plus the emergence of 4K High Definition video and eventually 8K Ultra High Definition, to provide plenty of growth in storage sales for video.

“We have good momentum,” he said. “And I don’t think it’s an anomaly, given that a lot of these markets are really nascent. I mean, the number of 4K installations is super small relative to what it’s going to be. So we have good momentum for this quarter for sure, and I think beyond that.”

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