Datalink Revenues Drop in Q3, Earnings Call Canceled Pending Acquisition

Datalink on Monday announced results for what could likely be its final quarterly report as it prepares for its acquisition by Tempe, Ariz.-based Insight Enterprises. The company's managers also canceled a planned conference call with investors and analysts to discuss its latest earnings results.

Eden Prairie, Minn.-based Datalink reported a 7 percent drop in revenues – to $184 million from $198 million – for its fiscal third quarter ended Sept. 30. On a GAAP basis, Datalink reported earnings of $546,000, or 3 cents a share, down from last year's earnings of $1.3 million, or 6 cents a share.

[Related: Datalink's Big Q4: Networking, Services Drive The Business While Storage Takes Back Seat]

On a non-GAAP basis, Datalink reported third fiscal quarter 2016 earnings of $2.6 million, or 12 cents a share, down from last year's earnings of $3.3 million, or 15 cents a share.

Datalink's revenue number missed analysts' expectations, but news of the acquisition caused its shares to climb $1.71 (18.13%) to $11.14 on Monday.

The company did not provide detail about why revenue and earnings fell during the quarter. It also declined to provide further information in response to a CRN request for comment.

In the earnings press release, Datalink did report a percent drop in product sales over last year ($108 million), coupled with a 2.4 percent rise in services revenues ($76 million).

Over the last couple years, the company has shifted its sales focus from products to solutions, and Cisco has, over that time, become the company's biggest growth driver, said company President and CEO Paul Lidsky during the Datalink's fiscal year 2015 financial conference call.