CommVault earnings miss Street

By Shrutika Verma

BANGALORE (Reuters) - CommVault Systems Inc (CVLT.O), posted lower-than-expected quarterly earnings and said it would not give a first-quarter outlook due to economic uncertainties, sending its shares tumbling as much as 18 percent in after-hours trade.

The data management software provider has been hit by the weak economy as customers tend to pull back on data backup services that CommVault offers.

"The negative impact from the recession affected our business in a number of ways...customers froze budgets, customers reduced their budgets," Chief Executive Robert Hammer said on a conference call with analysts.

CommVault saw more pricing pressure from both customers and competitors, he added.

The company, which has a worldwide reseller and an original equipment agreement with Dell Inc (DELL.O), generated about 22 percent of its revenue through Dell in the nine months ended December 31, 2008.

The poor fourth-quarter results were due to higher expenses and a drop in its software revenue.

"The weakness in the quarter was expected," ThinkEquity analyst Rajesh Ghai said. "But I didn't expect such a sharp decline."

However, CommVault's pipeline continues to remain strong, Ghai added, terming the investor response to the news "an overreaction."