APM, IT management, MSP

SolarWinds Targets Nearly $1 Billion In Revenues By 2020

SolarWinds (SWI), the IT management and MSP software provider that's set to go private, has a long-term business plan that predicts the company will approach nearly $1 billion (actually, $970 million) in revenues during the company's fiscal year 2020, up from $507 million in fiscal year 2015.

The revenue projections, shared in a SolarWinds SEC filing, also include an upbeat profit outlook. EBITDA, the company predicts, will grow from $220 million in FY2015 to $428 million in FY2020. Overall, the filing suggests that SolarWinds expects to perform strongly as customers and managed services providers (MSPs) seek to more effectively maintain on-premises, hybrid and cloud workloads.

Silver Lake Partners and Thoma Bravo announced plans to acquire SolarWinds  for $4.5 billion in October 2015. The bidding war for SolarWinds involved multiple private equity firms spanning 66 days of intense negotiations, according to ChannelE2E's review of related SEC filings. Shareholders are expected to approve the SolarWinds buyout in early 2016.

Growing -- But Fast Enough?

On the one hand, the company has continued to enjoy double-digit growth -- including strong performance for the N-able software business, which focuses on MSPs. But on the other hand, SolarWinds struggled to consistently meet Wall Street's lofty earnings and revenue growth expectations.

As a privately held company, SolarWinds should be able to focus on organic grow as well as private equity-funded acquisitions. Already, the company has tucked a range of ticketing and management software buyouts into the N-able business. And there are signs that SolarWinds will connect more dots between the company's application performance management (APM) and remote monitoring and management (RMM) product lines.

Predictably, SolarWinds' revenue forecasts include several qualifiers. The company says future growth could be impacted by the overall IT industry performance, regulatory issues, financial market conditions and more.


Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.