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Fairfax IT: VA Linux revises overoptimistic revenues forecast

Jan 17, 2001, 14:51 (0 Talkback[s])

"Linux software and support company VA Linux Systems today more than halved its expected revenues for its 2001 fiscal year, boding of tough times ahead and showing how tough it is to make money off open source software."

"The company issued a statement today warning that signs of a general economic slowdown in the United States has made the company rethink its earlier estimate of a 125 per cent increase in revenues for the financial year. It has now predicted revenues will only grow by about 60 per cent."

"Today's announcement coincides with the revelation that VA Linux expects revenue for the second fiscal quarter ending on January 27, 2001, to be $43 million to $50 million, an increase of 115 per cent to 150 per cent compared to the second quarter of fiscal 2000. ... "Going forward in this economic environment, we intend to focus on higher margin business and to manage expense levels such that we can achieve profitability given our revised revenue expectations."

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