Aruba Networks wants to turn your business into a wireless paradise. The company offers network access equipment and software for mobile enterprise networks. Its Mobile Virtual Enterprise (MOVE) architecture unifies access between wired and wireless network infrastructures for employees both at and away from the office. Products include controllers, access points, and concentrators, as well as operating system and management software. Aruba also provides professional and support services. It targets the corporate, education, and government sectors. Aruba outsources most manufacturing to partners such as Flextronics and Sercomm. The US is the company's largest market.
Aruba saw strong year-over-year growth in all its geographic segments. The US accounts for about 60% of sales, with the Asia-Pacific and EMEA regions each contributing more than 15%. EMEA showed the greatest growth, increasing more than 40% from fiscal 2011.
Sales and Marketing
The company sells its products directly, as well as through distributors, resellers, and OEMs. More than 90% of sales come from these channel partners, including ScanSource (more than 20% of sales), Avnet (14%), and Alcatel-Lucent.
The company's marketing activities include lead generation, telesales, advertising, website operations, and direct marketing, as well as public relations and trade show activities.
While the rest of the world has been weathering a stormy economy, Aruba's revenue has had a relative day at the beach, showing strong and consistent growth since its founding. The company reported fiscal 2012 (ended July 31) sales of about $517 million, a 30% jump from 2011 (which was itself a 50% increase over 2010). Aruba is reaping the benefits of the proliferation of mobile/wireless devices and the demand for applications and services for that market.
The company has lost money, however, each year with the exception of 2011 when a tax benefit boosted it into the black. Fiscal 2012 saw net income fall back into the red to the tune of about $9 million as Aruba continues to see substantial increases in product expenses, R&D, and sales and marketing expenses.
The company's key strategic pillars include a focus on a bring-your-own-device landscape, unified communications, and enterprise-wide penetration. Its software is powered by the ArubaOS, which houses its encryption, authentication, and network access technology.
As part of its unified communications endeavors, Aruba maintains a partnership with Microsoft that includes a vendor agreement and a technology development collaboration; Microsoft has installed Aruba products in various sites, and Aruba supports Microsoft network security and communications products such as Lync.
Aruba also enhances its offerings through strategic acquisitions.
Mergers and Acquisitions
In support of its MOVE technology, the company bought Avenda Systems in 2011, adding network security software that enables businesses to offer employees the option to wirelessly and securely connect their personal cell phones and laptops to the company network.
In 2010 Aruba acquired Azalea Networks, a supplier of outdoor mesh networks, for about $40 million in stock and cash. The company bought Azalea for its expertise in industrial enterprise networking, which can be more challenging than in offices and other indoor venues. Azalea serves customers in the energy, logistics, manufacturing, mining, petrochemical, public safety, smart grid, and transportation sectors. – less
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