Seeking Alpha

Street throws in the towel on Infoblox; Microsoft looms large

  • Infoblox (BLOX -39.9%) has received 5 downgrades after offering soft guidance (again) to go with mixed FQ3 results, and announcing long-time CEO Robert Thomas is leaving once a successor is named.
  • "While large customers, partners and field contacts remain positive on Infoblox’s technology, it has become clear there is not a quick and easy fix for the sharp slowdown in product orders that began last October," writes Pac Crest, cutting shares to Sector Perform.
  • Goldman (downgrade to Neutral) does a mea culpa for its February upgrade. It doesn't expect product rev. growth to re-accelerate in the near-term, given the CEO transition and a belief Infoblox is too focused on a "still-nascent security opportunity."
  • The firm also notes there was an "elevated level of concern" on the CC (transcript) about competition from Microsoft, which is integrating more IP address management/DNS features into Windows Server.
  • Thomas admitted Microsoft's price (or lack thereof) will intrigue some clients. "There's no doubt that when it's installed on a box for free, the customer is going to look at it a bit more closely." But he insisted Infoblox's rich feature set - "They don't have anything like the Grid, for example. They don't have a single management platform." - will help it win deals.
Comments (1)
  • fpittelli
    , contributor
    Comment (1) | Send Message
     
    Competition from "free" services added to Windows Server is not a serious threat when looking at similar network products in the past. For example, IP routing was a well-established, completely free service provided all Unix-based operating systems when Cisco was a fledgling company, but that didn't stop them from selling lots of boxes. A well-made box that provides a well-defined service will always find a home in a properly run network.
    30 May, 05:16 PM Reply Like
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