This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Fusion-io Inc., the Cottonwood Heights company that hopes to replace computer hard drives with flash memory technology, has filed new documents with the U.S. Securities and Exchange Commission that offer an additional glimpse into its planned initial public offering.
The company, which first signaled its intent to go public in early March, has indicated it now plans to sell its shares for $13 to $15 each. And instead of the $150 million it initially was considering raising, the company said it hopes to raise as much as $212 million.
Fusion-io's planned increase follows the successful IPO last week of LinkedIn Corp., whose shares more than doubled on its first day of trading.
The success of LinkedIn and other recently successful IPOs like Yandex — the largest search engine in Russia, show that investors are interested in high-growth, industry-leading tech companies, said Nick Einhorn, an analyst at Renaissance Capital, a Greenwich, Conn.-based company that tracks the IPO market.
He pointed out, though, that the success of LinkedIn doesn't mean that every tech company that goes public will be well received. He noted the shares of FriendFinder, an adult-oriented social-networking site that has minimal revenue growth and a high debt burden, have traded down 44 percent since its early May IPO.
"But it [LinkedIn] is going to give encouragement to other high-profile, relatively established, fast-growing companies like Facebook and Groupon that are looking to tap the IPO market,"Einhorn said.
The latest SEC filing from Fusion-io, which claims Apple icon Steve Wozniak as chief scientist, also offered additional information about its finances.
For the recently completed third quarter of its 2011 fiscal year, Fusion-io reported revenue surged to $67.3 million, an increase of more than 400 percent over the sales of $13.4 million the company recorded in the same period of its prior fiscal year.
During the third quarter, which ended March 31, Fusion-io also turned profitable, reporting net income of $7 million, compared with a $6.7 million loss for the same quarter a year ago.
Fusion-io said in late January that during the previous 12 months it shipped more than 15 petabytes of flash memory — enough to hold more than 1999 years of continuously played HD video — or 15,360 times the print content of the Library of Congress.
Flash memory has no moving parts. It can access data more quickly than the traditional hard drives that rely upon spinning disks to hold information.
Fusion-io, however, indicated that the bulk of its sales come from a limited number of customers. The largest 10 of those customers account for 91 percent of its revenue for the first nine months of its 2011 fiscal year. Its largest customer is Facebook, which accounted for 47 percent of Fusion-io's revenue so far in fiscal 2011.
"As a consequence of our limited number of customers and the concentrated nature of their purchases, our quarterly revenue and operating result may fluctuate from quarter to quarter and are difficult to estimate," the company said in its filing.
Fusion-io's latest filing, however, didn't indicate the date that it expects to launch its IPO but only said it would be "as soon as practicable."
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