Barracuda Closes, CudaDrive Services, May Be Looking To Sell Itself

Storage and security vendor Barracuda Networks on Monday said it is shutting down two of its cloud-based data protection and file sync and share services.

They are, a consumer-focused service, and CudaDrive, a business-focused service.

The company may also be in the process of looking to become acquired, according to a Bloomberg report.

[Related: Barracuda Networks To Acquire Intronis, Build Out Wider Storage, Security MSP Business]

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The moves come after the company reported Jan. 7 that third fiscal quarter 2016 revenue rose 14 percent year over year, to $80.1 million, while its losses on a GAAP basis hit $1.6 million, or 3 cents per share, down from a loss of $36,000 the year before.

Bloomberg, citing unnamed sources, reported Monday that Campbell, Calif.-based Barracuda Networks has asked Morgan Stanley to seek potential buyers and gauge interest in the company.

Barracuda, whose share price hit a 52-week high June 19 of $42.74, has seen its shares lose about 35 percent of their value since it reported its third quarter results, falling from $16.43 on Jan. 7 to under $11 in the weeks since. On Monday, Barracuda shares spiked 11 percent, to $11.75, after the news of a possible sale of the company.

The news that Barracuda is shuttering its and its CudaDrive services May 1 was revealed on those two offerings' websites. Both sites referred visitors to a Monday blog post by Rod Mathews, vice president and general manager for Barracuda's storage business.

Mathews, in his blog post, did not elaborate on why the decision was made to discontinue its and CudaDrive services. "We are constantly evaluating our product portfolio in the context of our overall strategic goals. With that in mind, we have begun a process to focus our resources on our most strategic initiatives and to drive more innovation and faster growth within those products," he wrote.

When contacted for more information, a Barracuda spokesperson replied by email that the only details being released for now on the and CudaDrive closures was in the Mathews blog.

Regarding the possible sale of the entire company, the Barracuda spokesperson wrote that company policy is to not comment on "any speculation rumors."

The news of the closures and the possible sale of Barracuda should not have a major impact on Barracuda's business for now, said Alain Bezahler, president of BCPi, a Sharon, Mass.-based solution provider and Barracuda channel partner.

"Our Barracuda business is good, and it's growing," Bezahler told CRN. "Barracuda's still a relatively young company. It's growing, and coming up with new channel programs."

Even so, Bezahler said, he could understand why Barracuda might consider selling itself.

"Barracuda is a company with many different product families which address many different areas of business," he said. "The company may not have anticipated how quickly people have adopted several cloud technologies. Many customers get some of the same features of Barracuda within Office 365 and Gmail, such as archiving. Those solutions are not as good as Barracuda's but they are free."