ShoreTel Blog

The Story Behind the Numbers

Posted by ShoreTel on Tuesday, January 29, 2008

Today we announced our second quarter earnings, and I’m now able to talk more directly about how well our business is doing. I want our customers, partners and prospects to see the state of our business clearly and not be misled or confused by recent headlines or what competitors might be saying. We’re not surprised to see competitors that are increasingly feeling the sting of our success try to create FUD; however that kind of activity only makes us more determined to maintain our momentum in the market. The reality is that our business continues to be fundamentally sound and our customer base is growing.

Our numbers speak for themselves. Our second quarter revenue of $30.6 million reflects a solid 36 percent revenue growth from the same period last year, and calendar 2007 revenue is 50 percent above calendar 2006, significantly better than our addressable market, which grew at an annual rate of 14 to 19 percent from the first 9 months of calendar year 2006 to the first 9 months of calendar year 2007. We also experienced non-GAAP net income of $3.8 million, a new record for ShoreTel. These numbers reflect a healthy company. I am pleased to report that more than 700 new customers joined the ShoreTel family in the second quarter, and customer satisfaction was at a record high during the quarter, demonstrating that we’re continuing to deliver world-class products with the lowest total cost of ownership.

For example, yesterday we announced our new Microsoft Dynamics CRM Integration Application, which provides a single interface for CRM and call control for streamlined business processes, and today we announced our new ShorePhone IP 565g color phone, to the delight of many of our users.

Also, beginning this month, we rolled out a special incentive promotion to encourage new customers to join the growing family of satisfied ShoreTel customers. Those interested in taking advantage of these promotions can contact us through our Web site at www.shoretel.com and click 'speak to a representative'.

Several additional new products and new customer wins are on the horizon. I look forward to sharing our progress with you.

John W. Combs

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Our Customers Tell the Real Story

Posted by ShoreTel on Monday, January 21, 2008

Dear ShoreTel Customers and Partners,

A lot has happened in the two weeks since I last addressed you directly in this blog. Similar to other situations where a company sees a significant drop in their stock, we were sued in class action litigation. While we take these things very seriously, we also look at them with perspective. We are not letting ourselves get distracted from the most important things in our business, namely keeping our current customers delighted and growing our customer base of raving fans. We are committed to executing our plans and regaining our momentum. If you’ve seen any of the conversations floating around the blogosphere these past two weeks you’ll see the opinions of some skeptics but you’ll see many if not more comments from our loyal customers and partners saying they continue to believe ShoreTel is bringing to market some of the best solutions for unified communications and enterprise class IP telephony. We’ve always known that we’ve had amazing loyal customers…it’s especially nice to see that kind of customer praise now. This week you’ll see another example of a recent customer win, Big Brothers and Big Sisters of North Texas and how they’re able to assist more children because they’ve installed a ShoreTel system. We’ll continue to share these customer stories so stay tuned.

John W. Combs

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Important Message to ShoreTel Customers and Shareholders

Posted by ShoreTel on Tuesday, January 08, 2008

Dear ShoreTel Customers and Shareholders,

I felt it was important to address the market’s reaction to our guidance announcement yesterday.

We believe this week’s news regarding the revenue miss for the quarter ending December 2007 should by no means overshadow our significant achievements in 2007 and our many opportunities for 2008. Our preliminary CY 2007 revenue was a new ShoreTel record and approximately 50 percent higher than our CY 2006 results, a growth rate well ahead of the overall industry’s 20-30 percent pace. In addition, our preliminary December 2007 quarter revenue was approximately 35 percent higher than the December 2006 quarter. We continue to have a solid balance sheet, backed by approximately $100 million cash in the bank.

Our recent awards from Deloitte, Inc. Magazine and the San Jose Business Journal recognizing our revenue growth are a testament to our focus on growing our business. ShoreTel is the world’s fastest growing provider of distributed unified communications solutions and continues to deliver the industry’s highest level of customer satisfaction. For the fourth year in a row, Nemertes' customer satisfaction survey ranked ShoreTel number one in every category.

ShoreTel also won the Customersat.com award and the Best-in-Class for Customer Service from ContactCenterWorld.com.

ShoreTel's products also continue to gain recognition and win industry awards; Best in VoiceCon '07 was the latest in a series. Thanks to our continued focus on delivering best-in-class product, 2007 was no exception; new product introductions included a family of high-density/small footprint switches, color phones, Mobile Call Manager, expanded international native trunking support, and numerous professional services integrations.

Looking to the year ahead, we believe our opportunity is bright. We have an exciting pipeline of new products that will be introduced throughout the year.

Stay tuned for more updates from ShoreTel.

All the best,

John W. Combs President & CEO ShoreTel, Inc.

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