NEW YORK (AP) -- Shares of Fusion-io Inc. plunged Thursday after the data-center technology company gave a fiscal 2014 forecast that fell far short of Wall Street's estimates.
THE SPARK: Fusion-io reported its fourth-quarter results and gave its guidance after the market closed on Wednesday. The company posted a much larger loss than last year, and offered a forecast for the new fiscal year that missed analyst expectations by nearly $43 million.
In the quarter ended June 30, Fusion-io posted a loss of $23.8 million, or 24 cents per share. It lost $2.4 million, or 3 cents per share, in the 2012 fourth quarter. The company said earned 21 cents per share if one-time items are excluded, down from 35 cents per share a year ago. Revenue edged down to $106.1 million from $106.6 million.
Analysts were expecting a loss of 3 cents per share and $110.1 million in revenue, according to FactSet.
THE BIG PICTURE: The Salt Lake City company said it lost $38.2 million, or 40 cents per share, in fiscal 2013, after taking a loss of $5.6 million, or 6 cents per share, in fiscal 2012. Revenue climbed 20 percent, to $432.4 million from $359.3 million.
Fusion-io said revenue will grow about 20 percent in the current fiscal year, which implies a total of about $519 million. Analysts were projecting $561.7 million on average.
The company expects $80 million to $90 million in revenue for the first quarter, well below Wall Street estimates of $123.8 million.
Fusion-io Inc.'s flash memory products allow companies to store large amounts of data and access it quickly. Facebook is among its biggest customers.
THE ANALYSIS: At least four analysts downgraded the stock, including Gary Mobley of Benchmark Research and Aaron C. Rakers of Stifel, both of whom who dropped their ratings to "Hold" from "Buy."
Rakers called the guidance "very disappointing," and said the results seem to reflect strain between the company and some of its customers. He also noted that there competition in the space is accelerating. "Aside from the ongoing debate on Fusion-io's value as an acquisition candidate, we see a meaningful lack of standalone catalysts given significant questions on the implied F2Q14-F4Q14 revenue expectations," he wrote in a note to clients.
SHARE ACTION: Shares plunged $3.51, or 23.6 percent, to close Thursday trading at $11.39. Earlier in the session, it dropped as low as $11.11, its lowest price since its June 2011 debut.