Extreme Networks to restructure

Networking vendor admits quarterly sales will trail expectations as customers delay spending

Extreme Networks is in cost-cutting mode again after announcing that quarterly results will come in behind expectations due to customer spending delays.

The networking vendor announced yesterday that it will restructure its business in a bid to cut about $7m (£4.4m) off its quarterly costs.

This will result in it taking a charge of $5.5m to $7m for its fiscal second-quarter results for the period ended 31 December, which will push it into the red to the tune of $4.5m to $7m.

Revenue for the quarter is set to come in at between $75m and $77m, below the low end of its previous guidance and well down on the $82.8m revenue recorded a year earlier.

Extreme laid the blame at the door of delays in customer expenditure, both in EMEA and the US.

The vendor did not give details of potential job losses but any headcount reductions will come on top of the 110 positions Extreme axed 18 months ago. That round of restructuring saw it incur a $3.5m pre-tax charge.