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Vertiv Will Take $80 Million Sales Hit Due To Coronavirus

Vertiv said the coronavirus will ‘negatively impact’ its first quarter 2020 sales by approximately $80 million due to shipment and supply chain ‘disruptions.’

The $4.4 billion data center specialist expects the coronavirus to “negatively impact” its current first quarter net sales by $70 million to $90 million.

“We expect the coronavirus to negatively impact our first quarter net sales by $70 million to $90 million and adjusted EBITDA by $28 million to $36 million due to shipment and supply chain disruptions,” said Vertiv CEO Rob Johnson during the company’s fourth quarter earnings report on Monday.

However, Vertiv says its full year 2020 sales guidance remains intact at $4.6 billion despite the coronavirus’ first quarter revenue impact.

[Related: Dell Technologies World 2020 Going Virtual Due To Coronavirus]

“Based upon what we know today, we are confirming our previously communicated full year 2020 financial guidance due to our expectation to partially recover these first quarter sales, our conservative planning process and additional cost actions put in place,” said Johnson. “Of course, paramount to us is the well-being of our employees, and we continue to take all necessary actions to assure their safety.”

Vertiv, who made CRN’s 2020 Data Center 50 list, reported fourth quarter 2019 sales of $1.2 billion, representing flat revenue growth year over year. The company reported a net loss of $34 million in the quarter.

Vertiv generated $694 million in infrastructure and solutions sales in its fourth quarter, up 2 percent year over year. Services and software revenue witnessed flat growth year over year at $342 million, while edge infrastructure hit $136 million, down 5 percent year over year.

For the full year 2019, Vertiv captured a total of $4.43 billion in revenue, up 3 percent compared to $4.28 billion in 2018.

“We finished 2019 with record quarterly orders, and our sales pipeline is strong and growing as we expect sustained top-line growth in 2020 – somewhat skewed towards the back-half of the year due to market timing [and coronavirus],” said Johnson.

The coronavirus is having a significant impact on a slew of IT companies.

Nvidia expects a $100 million revenue hit this quarter due to the coronavirus, while Apple said last month it no longer expects to achieve its $63 billion to $67 billion sales guidance for its current fiscal quarter. Technology companies are also postponing or canceling events while others are changing conferences to digital events due to the coronavirus outbreak.

The total number of cases of the virus has surpassed 110,000 worldwide with infections in more than 100 countries. Approximately 3,600 people have died from coronavirus as of Monday morning.

 

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