Boom! And This Is Just the Beginning!


Storage management expert Fusion-io (NYS: FIO) just saw its shares spike 30% overnight. The company's fourth-quarter report ripped right through analyst estimates with $107 million of top-line revenue boiling down to $0.09 of adjusted earnings per share.

CEO David Flynn is not one to mince words. Where other leaders might just celebrate rampant growth, Flynn turned his eye to the future right away: "We believe we are still in the early stages of demonstrating the transformative potential of software defined storage solutions that deliver greater performance and efficiency for customers at a fraction of the cost of legacy systems," he said. In plain English, he sees explosive growth ahead for more efficient data management systems.

The company is getting by with a little help from its friends. Leading system builders Hewlett-Packard (NYS: HPQ) , Dell (NAS: DELL) , and IBM (NYS: IBM) all bundle Fusion-io storage systems with their own servers and bulk storage units. All three tested and then launched new Fusion-io products this summer. And it doesn't stop there: Fusion-io added server upstart, nee networking giant, Cisco Systems (NAS: CSCO) to its roster in June. Any system builder worth mentioning is now aboard the Fusion-io bandwagon. Revenue from the company's "core customers" more than doubled this year, and the two largest partners represented 55% of Fusion-io's total sales.

Flynn expects the collaborative party to continue. Sales are projected to grow as much as 50% again in 2013 with stable margins and modest share dilution.

Fusion-io has kept pace with the general market in 2012 through a series of wild price swings. The company plays an increasingly important role in the big-data trend and should be able to climb dramatically from here. In fact, I'm so convinced of a bright future for this stock that I just opened a bullish CAPScall on Fusion-io -- today's price jump notwithstanding. Fools don't play the market-timing game, you know.

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Fool contributorAnders Bylundholds no position in any of the companies mentioned. Check outAnders' holdings and bio, or follow him onTwitterandGoogle+. The Motley Fool owns shares of Fusion-io, International Business Machines, and Cisco Systems.Motley Fool newsletter serviceshave recommended creating a synthetic long position in International Business Machines. The Motley Fool has adisclosure policy, securely stored in multiple copies across several server farms. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

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