Earnings call transcript: Quantum’s Q1 2025 Misses Revenue Forecast, Stock Drops

Quantum Corporation’s earnings call for the first quarter of fiscal year 2025 revealed a disappointing financial performance, missing both earnings per share (EPS) and revenue forecasts. The company’s stock reacted negatively, dropping significantly in the aftermath of the announcement. According to InvestingPro data, the company’s stock has shown significant volatility with a beta of 2.65, making it more than twice as reactive to market movements as the average stock.

Summary Paragraph

Quantum Corporation reported a non-GAAP net loss of £1.58 per share, contrasting with an expected break-even forecast. Revenue for the quarter reached £64.3 million, falling short of the anticipated £77.85 million. The stock fell by 16.98% to close at £7.12, reflecting investor disappointment with the earnings miss and revised guidance. The company’s shares continued to decline in aftermarket trading, down an additional 14%. InvestingPro analysis reveals 10+ additional insights about Quantum’s performance, including crucial metrics about its cash burn rate and debt position. Subscribers can access the complete financial health analysis, which currently shows a "WEAK" overall rating.

Key Takeaways

• Quantum’s Q1 2025 revenue and EPS missed analyst forecasts significantly.
• The stock declined by nearly 17% following the earnings release.
• The company launched new products targeting AI and data protection markets.
• Quantum raised £83 million in new capital and reduced its net debt by 40%.
• Forward guidance indicates a challenging outlook, with continued losses expected.

Company Performance

Quantum’s performance in Q1 2025 was marked by a notable decrease in both revenue and gross margin compared to the previous year. The company reported a GAAP gross margin of 35.3%, down from 37.4% year-over-year, and a GAAP net loss of £17.2 million. Despite these setbacks, Quantum has focused on launching innovative products and reducing operating expenses to improve its financial health.

Financial Highlights

• Revenue: £64.3 million, down from £72.3 million year-over-year.
• GAAP Gross Margin: 35.3%, compared to 37.4% in the previous year.
• Non-GAAP Net Loss: £14.5 million or £1.58 per share.
• Adjusted EBITDA: Negative £6.5 million.
• Cash and Equivalents: £37.5 million.

Earnings vs. Forecast

Quantum Corporation’s earnings fell short of expectations, with an EPS of -£1.58 against a forecasted break-even point. Revenue was also below the forecast of £77.85 million, resulting in a surprise negative difference of 23.33%. This marks a significant deviation from previous quarters, where the company had managed to meet or exceed expectations.

Market Reaction

The market reacted sharply to Quantum’s earnings miss, with the stock price dropping 16.98% to £7.12. The decline continued in aftermarket trading, with a further decrease of 14%. This places the stock near its 52-week low of £2.88, highlighting investor concerns about the company’s ability to meet future targets.

Outlook & Guidance

Quantum’s forward guidance suggests further challenges, with projected revenue for Q2 2025 expected to be around £61 million. The company anticipates a non-GAAP net loss per share of -£0.26 and aims for breakeven adjusted EBITDA in the upcoming quarter. Despite these challenges, Quantum is focusing on sales execution and expanding its partner ecosystem. InvestingPro data shows that two analysts have recently revised their earnings estimates upward for the upcoming period, with analyst price targets ranging from $13 to $20. Get access to the full Pro Research Report for comprehensive analysis of Quantum’s future prospects and valuation metrics.

Executive Commentary

CEO Hughes Marath emphasized the company’s commitment to executing its strategy and achieving results. "We will do what we say we will do, take full responsibility for our commitments and move quickly to achieve results," Marath stated. He also highlighted efforts to strengthen the financial foundation and innovate across the product portfolio.

Risks and Challenges

• Continued financial losses could strain Quantum’s resources.
• Market competition in data storage and protection remains intense.
• Economic uncertainties could impact demand for Quantum’s products.
• Dependence on successful product launches to drive revenue growth.
• Potential disruptions in supply chain and operational execution.

Q&A

During the earnings call, analysts raised questions about Quantum’s product portfolio strategy and the impact of operating expense reductions. The company clarified its focus on the DXi and cold storage markets and addressed concerns about seasonality affecting future performance.

Full transcript - Quantum Corp (QMCO) Q1 2026:

Conference Call Operator: Good afternoon, and welcome to Quantum Corporation’s Fiscal First Quarter twenty twenty six Financial Results Conference Call. At this time, all participants are in a listen only mode. At the conclusion of today’s conference call, instructions will be given for the question and answer session. As a reminder, this conference call is being recorded today, Wednesday, 09/10/2025. I would now like to turn the call over to Tara Ilgif, Quantum’s Vice President of Corporate Affairs.

Tara, please go ahead.

Tara Ilgif, Vice President of Corporate Affairs, Quantum Corporation: Good afternoon, and thank you for joining today’s conference call to discuss Quantum’s first quarter fiscal twenty twenty six financial results. With me on today’s call are Hughes Marath, Quantum’s CEO and Laura Nash, Chief Accounting Officer. Following management’s prepared remarks, we will open the call to questions from analysts. Before we begin, I would like to remind you that comments made on today’s call may include forward looking statements. All statements other than statements of historical fact should be viewed as forward looking, including any projections of revenue, margins, expenses, adjusted EBITDA, adjusted net income, cash flows or other financial, operational or performance topics.

These statements involve known and unknown risks and uncertainties that we refer to as risk factors. Risk factors may cause our actual results to differ materially from our forecast. For more information, please refer to the detailed descriptions we provide about these and additional risk factors under the Risk Factors section in our 10 Qs and 10 ks filed with the Securities and Exchange Commission. The company does not intend to update or alter forward looking statements once they are issued, whether as a result of new information, future events or otherwise, except where required by applicable law. Please note that today’s press release and management’s statements during today’s call will include certain financial information in GAAP and non GAAP measures.

We will include definitions and reconciliations of GAAP to non GAAP items in our press release. With that, it’s my pleasure to turn the call over to Quantum’s CEO, Hughes Mayrath.

Hughes Marath, CEO, Quantum Corporation: Thank you, Tara, and good afternoon to everyone. Thank you for joining us on our first fiscal quarter and business update conference call. I’m pleased to be joining you for my first investor call as Quantum’s CEO. It’s an exciting time to lead the company as I believe Quantum is on the cusp of a new chapter in its transformation journey. With over thirty years of experience in the networking and data storage industry as a supplier to Quantum, an employee, a competitor and a Board member, I’ve interacted with this company from every angle.

And my career stands from my early beginnings that this drive and tape drive business as a supplier to Quantum to holding executive roles at EMC’s Backup and Recovery Services, as well as Juniper Networks and Brocade. This knowledge and direct experience give me a unique perspective to step into the role and begin taking decisive action toward our goal of improving our financial position and sales execution. Before diving deeper into the business and go forward strategy, I’d like to first turn the call over to our Chief Accounting Officer, Laura Nash. Laura has been with Quantum since 2019, initially serving as our Controller before being named Chief Accounting Officer in 2023. She’ll walk through a brief overview of our recently reported financial results, and then I’ll talk more about the steps I’ve taken since my appointment to improve our go to market strategies and operational initiatives.

Laura, please go ahead.

Laura Nash, Chief Accounting Officer, Quantum Corporation: Thank you, Hugh. Good afternoon to those joining us on the phone and webcast. I will provide an overview of the company’s GAAP and non GAAP financial results for our first fiscal quarter twenty twenty six ended 06/30/2025. Before I begin, I would like to emphasize that all comparisons to financial figures in prior periods reflect the company’s recent restatement of financial results as well as certain revisions to immaterial misstatements of previously published quarterly financial results for fiscal year twenty twenty five. Revenue in the quarter was £64,300,000 compared to £61,300,000 in the 2025 and £72,300,000 in the prior year first quarter.

The decrease in revenue primarily reflects a shift in product mix as we’ve continued to transition towards a higher value business. Backlog at the end of the first quarter was approximately 10,000,000 which is at the higher end of our target run rate of GBP 8,000,000 to 10,000,000. GAAP gross margin for the first quarter was 35.3% compared to 39.6% in the fourth quarter and 37.4% in the 2025. The sequential and year over year decrease in gross margin is primarily attributable to an increase in our inventory provisions for certain end of life product in addition to import tariffs encouraged during the quarter. This was partially offset by improvements in operational efficiency in our service organization.

GAAP operating expenses for the first quarter were GBP 35,300,000.0 compared to GBP 35,800,000.0 in the prior quarter and GBP 43,900,000.0 in the year ago quarter. The GBP 8,600,000.0 year over year decrease in operating expenses primarily reflects the significant nonrecurring accounting and legal expenses incurred in the year ago quarter associated with the company’s previously completed restatement of financial results for the prior fiscal years ended 03/31/2022 and 03/31/2023. Operating expenses on a non GAAP basis for the first quarter were GBP 30,000,000 compared to GBP 29,400,000.0 in the fourth quarter and £30,800,000 in the year ago quarter. While the company did realize savings due to restructuring plans executed in fiscal twenty twenty five and the 2026, these savings were largely offset by increases in the cost of compliance relating to auditing and legal fees. GAAP net loss in the first fiscal quarter was GBP 17,200,000.0 or a loss of 1.87 per share compared to a net loss of $7,700,000 or a loss of $1.26 per share in the previous quarter and a net loss of $19,900,000 or a loss of $4.15 per share in the year ago first quarter.

The reduction in GAAP net loss compared to the year ago quarter was largely driven by the aforementioned cost of restatement. Non GAAP loss for the first quarter was $14,500,000 or a loss of $1.58 per share compared to a net loss of $12,300,000 or a loss of $2.01 per share in the prior quarter and a net loss of $7,600,000 or a loss of $1.59 per share in the same quarter a year ago. The higher non GAAP net loss for the quarter reflected a combination of lower revenues coupled with the increased inventory provision and increased import tariffs previously discussed. Adjusted EBITDA for the first quarter was a negative £6,500,000 compared with a negative £3,900,000 in the fiscal fourth quarter and a negative £2,200,000 in the prior year quarter. The lower adjusted EBITDA for the fiscal first quarter was primarily a result of factors that contributed to the previously mentioned higher net loss.

Turning to an overview of debt and liquidity at quarter end. Cash, cash equivalents and restricted cash at the end of the first fiscal quarter were approximately $37,500,000 Total outstanding term debt at quarter end was 104,300,000.0 During the quarter, the company utilized proceeds from the sale of the shares through its existing standby equity purchase agreement with Yorkville Advisors to pay down the full outstanding balance of its previous revolving credit facility. As a result, there was no outstanding balance on the revolving credit facility as of June 30, and the company subsequently terminated this credit facility on 08/13/2025. At the end of the quarter, the company’s net debt position was approximately GBP 66,800,000.0, representing a reduction of more than 40% from the net debt position at the end of fiscal twenty twenty five. Now turning to the company’s outlook for the 2026.

Revenue for the second quarter is expected to be approximately £61,000,000 plus or minus 2,000,000 We expect a significant reduction in second quarter non GAAP operating expenses to approximately $27,000,000 plus or minus $2,000,000 reflecting the anticipated realized benefits from our most recent cost reduction actions. As a result, non GAAP adjusted net loss per share for the fiscal second quarter is anticipated to be negative $0.26 plus or minus $0.10 per share based on an estimated 13,300,000.0 shares outstanding. Adjusted EBITDA for the fiscal second quarter is expected to be approximately breakeven. With that, I’ll now hand the call back to Hughes.

Hughes Marath, CEO, Quantum Corporation: Let me now outline our path forward and areas of operational focus. Since my appointment in early June, I’ve been dedicating a significant portion of my time to conducting in-depth reviews of the business operations with our internal teams as well as meeting with key customers and partners. Quantum has a solid foundation of high value assets with a tangible opportunity to improve sales distribution and execution as part of a bolder product first approach. The company’s solutions and roadmap are very well aligned with growth trends in AI, media and entertainment, data protection and long term archiving. I believe in operating with transparency, honesty and urgency.

I expect the same from our team. We need to be clear about the work ahead, honor our commitments and move quickly to deliver results. That’s the standard I hold myself to and the standard I expect across the organization. In my first ninety days, we’ve taken critical steps. We established a new Board operating plan.

We raised funds to improve our financial position, reduced operating expenses and rightsized the organization to align with current revenue and growth. These were not easy decisions, but they were necessary to stabilize the company and strengthen its financial position to improve EBITDA results and achieve positive cash flow. We’ve also strengthened our executive team and Board with accomplished leaders who bring the expertise we need to guide this next chapter. As a first step, I recruited Tony Krathorn as Chief Revenue Officer. Tony brings more than twenty five years of executive sales and marketing experience across The U.

S, Europe and Asia at companies that include IndexEngine, Zadora, Comprise, Brocade and Hitachi Data Systems. Having worked with Tony before, I know he brings discipline and energy to scaling sales organizations. We also appointed Greg Pugmeyer as Vice President of Americas Sales. Greg has more than thirty years of experience delivering high impact solutions across storage, cloud and software. His customer first leadership style makes him the right person to lead our sales execution across The U.

S, Canada and Latin America. We added two highly accomplished Board members. Tony Blevins brings over twenty years of experience in supply chain management and operations at Apple and IBM. And Tony was named the 2022 Captain of Industry by the International Institute of Industrial and Systems Engineering. Jim Clancy brings more than thirty years of sales leadership in data protection and cyber recovery at Dell EMC and will help us refine our sales and go to market model.

With these additions, our Board is now aligned with each part of the business, including R and D, finance, sales, operations and supply chain, bringing greater oversight and guidance. As you likely noted, we recently terminated our outstanding revolving credit agreement after paying down the outstanding balance. In addition, we continue to make progress with our current lenders with respect to potential transaction to restructure our remaining outstanding term debt. We expect we will be in a position to announce something more definitive before our next earnings call. As a key step towards this goal and to improve overall liquidity, we’ve raised approximately $83,000,000 in new capital from the previously announced standby equity purchase agreement through our partner, Yorkville Advisors.

This has been a highly successful partnership and equity vehicle providing immediate access to capital in support of our ongoing operations, while also strengthening our balance sheet. With this stronger foundation in place, our attention is now squarely on product and sales level execution. In sales, this means sharpening our discipline, using metrics and numbers to guide decisions and building a culture of accountability. We are restructuring teams to align with our growth model and ensure every part of the sales process from forecasting to customer support operates with precision and discipline. At the same time, we’re placing a greater focus on our channel partners.

We are giving more attention to our top partners in each region, helping them cross sell and upsell across the portfolio and providing stronger incentives. We’re also bringing in new partners that specialize in data protection and cybersecurity, key areas of growth for us. And we already made swift changes in APAC, adding new distributors in South Asia, India and China to expand our reach, strengthen support and drive increased sales in fast growing markets. As we build momentum, our portfolio remains one of the greatest strengths and we’re focusing our resources on the solutions where we deliver the most differentiated value. This quarter, we launched two new DXiT Series models that deliver the industry’s first 1U all flash deduplication appliances, offering up to four eighty terabytes and built for fast recovery.

These extend our award winning T Series line and position us to capture share in a multibillion dollar backup market. At the same time, the explosion of AI and data growth is fueling unprecedented demand for the cold storage and long term archiving at the lowest possible cost. Quantum is uniquely positioned to meet this need. We provide not only the fastest primary storage for AI and media and entertainment workflows, but also the lowest cost archiving solutions used today by most of the world’s largest hyperscalers. ActiveScale cold storage and the Scalar i7 Raptor tape library give customers unmatched price performance and scalability, anchoring our long term archive strategy and meeting the data challenges of the AI era.

We are also turning our attention to StorNext, reinvigorating one of Quantum’s most trusted solution and the gold standard in media and entertainment for performance, scalability and reliability. Customers cannot connect however they prefer Ethernet IP or fiber channel without sacrificing performance. Our Ethernet based parallel client delivers aggregate read performance of up to 90 gigabytes per second, making StorNext one of the most capable shared storage systems for modern creative workflows. Just as important as the products themselves is how we develop them. We’re building a tighter cycle of feedback between sales and product so that the voice of customers and their specific use cases flow directly into development.

This ensures we’re targeting the right markets, aligning our roadmap with real world demand and delivering solutions that drive adoption and revenue. That closed loop of listening, building and executing will be central to how we operate going forward. In closing, our focus both inside and outside the company comes down to three things, integrity, ownership and urgency. We will do what we say we will do, take full responsibility for our commitments and move quickly to achieve results. The decisive steps we’ve taken in my short tenure are only the beginning.

We are strengthening our financial foundation, sharpening sales execution, deepening our partner ecosystem and innovating across our portfolio. While there is more work to do, I’m confident in our path and our ability to deliver long term value for our customers, partners, employees and shareholders. With that, I will now turn the call over to the operator for the Q and A session.

Conference Call Operator: Thank you. And at this time, we will conduct our question and answer session. And our first question comes from Eric Martinuzzi with Lake Street Capital Markets. Please state your question.

Eric Martinuzzi, Analyst, Lake Street Capital Markets: Just curious to know if there is a change in strategy at all planned. I noticed you went through kind of the product mix that we’re all familiar with. You talked a little bit about DXi and the tape libraries. Any change in emphasis or go to market with products such as Myriad or ActiveScale? Or is it kind of, hey, this is the product portfolio, let’s go out and sell what we’ve got?

Hughes Marath, CEO, Quantum Corporation: Thank you for the question, Eric. Well, first, have to sell what we have, right? I mean DXi has been in the portfolio for a long time. So is that the scale cold storage? I do believe we have tons of opportunities with DXi.

As you can see, like, Jim Clancy, like, joined the board from the Dell side and has plenty of experience with DataMain. So so we’re gonna push DXi hard the next few quarters because we feel we’re underperforming and there’s an opportunity for us. At this scale, cold storage, I think, is a is a great product as well. People will need, very affordable solutions for long term data retention. So we feel like we it’s also a place where we can do a lot more.

We’ve, Tony and I Tony Krayson and I spent a lot of time on the road talking to channel partners and customers. And StorNext, the last two, three years, has been underinvested into. So we’re heading over to IBC in Europe, but we’re making changes to StorNext. We’re pushing the Ethernet IP version of StorNext right now, which is, you know, very demanded. So so we feel like StorNext, requires more investments and a push in the Ethernet IP side of the business, and and we feel that’s closer to what the channel partners and customers want.

So so these these are some of the immediate things we’re gonna do. In the longer term, you can expect to see us refine the portfolio and the solution. So it’s a little bit early to go there, but if not, let’s go focus on those.

Eric Martinuzzi, Analyst, Lake Street Capital Markets: Got it. And you mentioned some of the management changes as well as the changes on the Board. Are we filling other open positions that you’re looking to fill as far as your direct reports go?

Hughes Marath, CEO, Quantum Corporation: Well, we’ve changed a lot right now, so there may be, you know, maybe a tweak or two. But, I don’t expect some radical changes going forward at this point. We we’ve tried to be very swift in the changes we’ve made so we don’t disrupt the business too much. It’s, it’s a lot to change the management team. It’s it’s sometimes a little bit, confusing for some of the customers or partners, but the reception was very, very warm.

I think everybody was very collaborative and everybody is on Quantum’s camp. So I feel very confident that we’re on the right path right now, and we have a very strong management team.

Eric Martinuzzi, Analyst, Lake Street Capital Markets: Okay. And then last question for me is on the operating expense. You mentioned a recent restructuring. So bridge me from the $30,000,000 of non GAAP operating expense that we had last quarter to the $27,000,000 midpoint, was that all did all of that change take place July 1, so we’re going to see 30,000,000 become 27,000,000 kind of overnight? Or is there a chance this kind of rolls into Q3, Q4?

Hughes Marath, CEO, Quantum Corporation: Yes. I’m going have Laura answer that, but we’ve made a lot of changes. There are some restructuring expenses. Some of the headcount is also transitioning out over a few months, so she can help with more details on that.

Laura Nash, Chief Accounting Officer, Quantum Corporation: Yes, absolutely. So there have been certain restructuring events that had happened in fiscal Q1 as well. Those coupled with the changes that happened in early July are expected to materialize in fiscal Q2 to a large extent, is causing the expected changes in our operating expenses. Also, are some additional costs we incur during our fiscal Q1, which are not likely to repeat in our fiscal Q2, but our normal run rate business.

Eric Martinuzzi, Analyst, Lake Street Capital Markets: Got it. Thanks for taking my questions and good luck.

Conference Call Operator: Thank you. Thank you. Your next question comes from Nehal Chokshi with Northland Capital Markets. Please state your question.

Nehal Chokshi, Analyst, Northland Capital Markets: Yes. Thank you. And good to see that your overall debt has been reduced, the revolver specifically, and that your net debt significantly reduced here through the use of Vascepa. For the term debt that you do have, can you remind us what’s the interest rate on it and how much of that is paid in kind?

Laura Nash, Chief Accounting Officer, Quantum Corporation: Make full disclosure of that in our 10 Q, and that will be included in our footnote forward to the 10 Q.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay. And is that filed now, the 10 q?

Laura Nash, Chief Accounting Officer, Quantum Corporation: Excuse me. Sorry. Can you repeat the question?

Nehal Chokshi, Analyst, Northland Capital Markets: Has the 10 q been filed for the June yet?

Laura Nash, Chief Accounting Officer, Quantum Corporation: The 10 Q will be filed shortly.

Nehal Chokshi, Analyst, Northland Capital Markets: Got it. Okay. And then I think Erica asked this question, but I’m going ask in a slightly different way. Based on the EBITDA guidance, which is going to improve from a negative $6,500,000 from the June to which you’re guiding to breakeven for the September on a midpoint $3,000,000 Q o Q revenue decline. Does that resume basically a flattish gross margin Q o Q?

Laura Nash, Chief Accounting Officer, Quantum Corporation: Yes. So we do have certain one time expenses in our current gross margin, including the inventory provision for certain end of life product. While the expected impact of tariffs is we are anticipating will continue, We’re expecting a gross margin more in line with our fiscal Q2 twenty twenty five in our guidance. However, we would like to caution you that does depend on our revenue mix. And so as we see increases in hyperscaler that does impact our gross margin as well as the macroeconomic environment.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay. And it sounds like the actual non GAAP OpEx, you’re expecting that to be about flattish Q o Q as well from June, Q to September?

Laura Nash, Chief Accounting Officer, Quantum Corporation: From June to September, we are expecting a decline in our OpEx. This is due to the realization of the restructuring activities that happened early in the quarter as well as some run rate expenses that are seen in Q1 that we are not expecting to recur in Q2.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay. So that’s like, what, about a 6,000,000 to $9,000,000 Q o Q decline in OpEx then?

Laura Nash, Chief Accounting Officer, Quantum Corporation: From a GAAP OpEx perspective, we have not guided that number. However, from a non GAAP perspective, we’re anticipating approximately a $3,000,000 decline.

Nehal Chokshi, Analyst, Northland Capital Markets: Great. Thank you. Okay. All right. And then what’s the typical seasonality for the September?

And any reasons for any divergence from what is typical seasonality?

Laura Nash, Chief Accounting Officer, Quantum Corporation: I’ll take that one. So thinking about our seasonality, we experienced our peak ordering in fiscal Q3. We do see some strong business in our fiscal Q2. However, we believe that the guidance we have put out is accurate, and we are not expecting any deviations from kind of our normal experience.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay. I feel like from like fiscal year twenty eighteen to fiscal year twenty twenty three, typically fiscal Q2 was up Q o Q, and that may have had a lot to do with the federal vertical buying. I’m I’m not sure. Is that correct?

Laura Nash, Chief Accounting Officer, Quantum Corporation: Yes. We do see the Fed Girods, hitting in, our fiscal Q two. That is correct.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay. But that from your lens of perspective, that doesn’t typically produce an overall Q2 increase in revenue?

Laura Nash, Chief Accounting Officer, Quantum Corporation: That does depend quarter over quarter and year over year. So the we’re as I said, we’re expecting the guidance that we’ve put out to be accurate.

Nehal Chokshi, Analyst, Northland Capital Markets: Yes. Absolutely, I would expect that as well. Okay. And then can you I’m sure this will be disclosed in the ’10 Q, but if you could disclose it now, the segment data?

Laura Nash, Chief Accounting Officer, Quantum Corporation: Yes. That will be provided now in Q2. That will be enough at Note 12.

Nehal Chokshi, Analyst, Northland Capital Markets: All right. Hughes, you mentioned that you want to be pivoting to areas in the market where you believe Quantum delivers the most value. Can you detail what are those areas where you believe Quantum can has the most differentiated products here?

Hughes Marath, CEO, Quantum Corporation: Yes, for sure. First, like I said earlier, do feel like we have a given right to play in the DXi space because we actually invented data dedu. So I think we took it for granted for a long time and just left like this asset on the line for a bit. But with our recent products that have, like, a one new flash based extremely fast fast, both from backup and instant recovery, I feel like we have a great solution. I would say, you know, the tape market is, is interesting.

Right? And and at the scale cold storage as well. We’ve been behind, like, a lot of the hyperscalers. And I I do believe that going forward, you can look at AI. You can look at the media entertainment space.

Everybody’s gonna go see a lot of data growth in the next two, three years, and people are concerned about the spend. And and from what we can see, people are looking back at tape in a with a different eye right now. We have different technology for for tape. We have the original coding. We have all types of security behind it.

And, we can present tape, like, as a poor storage through active scale cold storage, which make it makes it very easy to use. So, you know, when I was talking to all the channel partner and customers, unexpectedly, active scale cold storage became this really interesting topic to everybody that’s struggling with cost right now. So I think that’s something we we need to put some strong execution behind. We have great customers at Quantum. Unfortunately, I can’t give the list of all the customers.

But, you know, if you watch TV, if you have a favorite sports team, a TV show, a movie, or if your store files in the cloud, everybody’s using Quantum one way or another, and you just don’t know it. Right? So so I feel like we have a strong story. We have great customers. We need to figure out how to upsell and cross sell through those great customers we have.

And with the restructuring in in sales and and the team, we’re at NICE super motivated to go to those customers and ask for a fair share of the business. So I feel really optimistic about that.

Nehal Chokshi, Analyst, Northland Capital Markets: Okay, great. Thanks for that detail there. On that first area that you talked about, the deduplication space, backup space, you guys have been out with your All Flash product, I think, for more than a year now. And if I recall, Quantum executives were pretty excited about initial demand indications there. Did that not transpire?

Or it’s transpire, but it’s just too small to be driving the top line here?

Hughes Marath, CEO, Quantum Corporation: Yes. I think as we’re going through the process right now, what we’re finding out is our lead generation all the way to the conversion is not that great. We have to change the process. So we’ve consolidated sales and marketing right now into one group. You know?

So I think it’s important right now that you don’t have a sales and marketing finger pointing. We’re gonna change the way we do lead generations. We’ve changed the sales compensation programs because there are gaps and we can get excited. But if the salespeople don’t get paid or the incentives are in the wrong places, then it just doesn’t work as well. And we also have, frankly, to go build like an enterprise channel for DXI, Right?

So Quantum’s been focused in North America mainly on media entertainment. So we’re going to need new partners, and we’re going have to train them. So the whole flow, the whole process anyway from leads to sales compensations to partners to partners best and everything is being retooled right now between Greg Burkmeier and Tony Creighton.

Conference Call Operator: Thank you. And there are no further questions at this time. So with that, we will conclude today’s conference. Thank you for connecting and all parties may now disconnect. Have a good day.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.