Riverbed blames 'weak government spending' for missing Q1 earnings

Things didn't look good for Riverbed after publishing its first quarter earnings report on Monday afternoon.

The networking company reported a net loss of $8.1 million, or five cents a share (statement). Non-GAAP earnings were 23 cents a share on a revenue of $253 million.

Wall Street was expecting Riverbed to report first quarter earnings of 24 cents a share on revenue of $262 million.

As a result, Riverbed shares dropped initally by 9.5 percent to $13.44 after-hours trading.

CEO Jerry M. Kennelly shifted the blame in prepared remarks, attributing the miss to weak sales from government customers:

Non-GAAP revenue grew thirty-eight percent over the prior year and ten percent without the benefit of $52 million contributed by OPNET in the quarter. Despite weak government spending and general economic softness impacting results, WAN optimization revenue increased six percent year-over-year. Our market expanding products outside of WAN optimization and OPNET generated more than 40% year-over-year growth. Over the long-term, we believe our multi-product strategy to deliver unmatched application performance will allow us to accelerate the company’s revenue growth.

To recall, Riverbed acquired Opnet Technologies, a network management software provider, for nearly $1 billion back in October. Execs are banking on Opnet to better contribute to revenue and earnings results during the second half of 2013.