SecureWorks cuts full-year revenue forecast; shares fall
Compares with estimates, adds details, executive comments from conf call, share movement
June 5 (Reuters) - SecureWorks Corp SCWX.O on Wednesday cut its full-year revenue forecast range, overshadowing the cybersecurity firm's narrow first-quarter loss and sending its shares down 6%.
Chief Executive Officer Michael Cote, on a conference call with analysts, said the annual contract value of sales closed during the quarter was below the company's expectations.
SecureWorks now expects fiscal 2020 revenue between $535 million and $545 million, down from $565 million and $575 million it had previously forecast.
Chief Financial Officer Wayne Jackson said the impact of lower annual contract values amounts for a "significant portion of the revenue revision."
SecureWorks, in which Dell Technologies Inc DELL.N holds a stake of about 86%, also forecast current quarter revenue between $132 million and $134 million, below analysts' estimates of $139.2 million, according to IBES data from Refinitiv.
Atlanta-based SecureWorks offers information security solutions aimed at protecting corporate networks from cyber attacks to 4,300 clients in more than 50 countries, according to its website.
Earlier this year, Reuters reported, citing people familiar with the matter that Dell is exploring sale of SecureWorks.
The dismal forecast weighed on the smaller loss that the company posted as a result of higher spending by enterprises to fend off cyber attacks.
The company's net loss narrowed to $8.23 million, or 10 cents per share, in the first quarter ended May 3, from $13.8 million, or 17 cents per share, a year ago.
Excluding items, SecureWorks posted a loss per share of of 2 cents, while analysts were expecting a loss of 5 cents per share.
Net revenue of SecureWorks rose 5.3% to $132.8 million, slightly ahead of estimates of $132 million.
(Reporting by Vibhuti Sharma in Bengaluru; Editing by Shailesh Kuber)