Aruba Networks might be named Airuba for its products that provide wireless networking capabilities to a range of customers. The company offers network access equipment and software for mobile enterprise networks. Its Mobile Virtual Enterprise (MOVE) architecture unifies access between wired and wireless network infrastructures for employees both at and away from the office. Products include controllers, access points, and concentrators, as well as operating system and management software. Aruba also provides professional and support services. It targets the corporate, education, and government sectors. Aruba outsources most manufacturing to partners such as Flextronics and Sercomm. The US is the company's largest market. Aruba is part of Hewlett-Packard Enterprise after the 2015 acquisition.
Change in Company Type
After 13 years as an independent company, Aruba was acquired by Hewlett-Packard for about $3 billion. Aruba's wireless products should complement and extend HP's networking product line as more wireless connections are sought for more locations such as hotels, schools, stadiums, or entire cities. With the break up of HP into two companies in late 2015 Aruba went with HP Enterprise, the company focused on computing products for large organizations.
In 2014 Aruba reported strong year-over-year growth in all its geographic segments. The US has accounted for two-thirds of sales, with the Asia-Pacific and EMEA regions each contributing around 15%.
Sales and Marketing
The company sells its products directly, as well as through distributors, resellers, and OEMs. More than 90% of sales come from these channel partners, including ScanSource (more than 20% of sales), Synnex Corp. (13%), and Alcatel-Lucent.
The company's marketing activities include lead generation, telesales, advertising, website operations, and direct marketing, as well as public relations and trade show activities.
In its last annual report as a public company, Aruba reported that revenue climbed 22% from $600 million in 2013 to a record-setting $729 million in 2014. Its net losses have primarily stemmed from high operating expenses each year.
The historic revenue growth for 2014 was driven by a 25% surge in sales in each region of the US and EMEA. Aruba was also helped by the expansion of its customer base coupled with incremental purchases from existing customers as a result of ongoing strength in the enterprise mobility market.
Aruba's cash flow in operating activities followed an upward trend from 2010 till 2013; however, in 2014 cash provided by operating activities decreased by $41 million compared to 2013 which was primarily due to a decrease of $51 million from changes in operating assets and liabilities throughout the year.
The good news for Aruba devotees, called Air Heads, is that Aruba products will continue under the Aruba brand under HP Enterprise auspices. The idea is that all of HP's networking products will be sold through Aruba. The acquisition provides HP with a strong wireless communications technology to offer customers who are trying to make sure people in large businesses, educational settings, stadiums and the like unfettered and uninterrupted wireless access. The combination of HP's strong enterprise relationships and Aruba's sales force could help expand Aruba's reach.