Aruba: Successful IPO So Far

Aruba: Successful IPO So Far

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Written By Eric Sandler

By Eric Griffith

March 28, 2007

The wireless infrastructure company seems to be sustaining itself after launch, unlike some.

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Aruba Networks launched its initial public offering (IPO) yesterday at a price of $11 per share for 8 million shares sold, and closed yesterday at $14.15, up 29% on its first day.

The stock — on the NASDAQ index under the symbol ARUN — has continued to stay up on its second day of trading ($14.69 as of this writing), in contrast to the last hyped wireless company IPO, Clearwire , which dropped by more than 9% on its second day of trading earlier this month.

The money raised by Aruba — around $88 million — will allow it to continue to take on rivals Cisco and Motorola (the latter bought out Symbol in September 2006), who take the top two slots in enterprise WLAN sales according to Synergy Research Group. Aruba is #3, followed by 3Com. Aruba’s year-to-year growth as of the end of 2006, however, was 62%, while Symbol and 3Com both saw a loss.Still, Sunnyvale, California-based Aruba has yet to turn a profit after five years in business. It had a net loss of $11.7 million (after revenue of $51 million) in the six months ending January 31, 2007. The company’s fourth and last round of venture funding took place in October 2005, bringing it a total equity investment of $84 million from firms including Matrix Partners, Sequoia Capital and Trinity Ventures.

Eric Sandler

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