The shares of A10 Networks Inc (NYSE:ATEN), a software based application networking solutions provider, showed volatility during its initial public offering (IPO) on Friday, March 21.
The stock price of the company plunged by approximately 10% from its offering price of $15 to $13.58 per share then went up to as much as $16.50 per share.
As of this writing, around 2:18 PM in New York, the equities of A10 Networks Inc (NYSE:ATEN) are trading at $15.52 per share, up by 3.47%. The software-based applications networking solutions company raised $187.0 million after selling 12.5 million shares in the IPO.
A10 Networks financial performance
During the past three years from 2011 to 2013, A10 Networks Inc (NYSE:ATEN) recorded revenue growth from $91.2 million to $141.7 million. The company stated that it was profitable in prior years, but incurred a $90.1 million net loss in 2012 and $27 million net loss last year.
The company explained that its significant losses in 2012 and 2013 were associated with expenses related to its defense and settlement in litigation involving Brocade Communications Systems, Inc. (NASDAQ:BRCD) and a separate litigation against Radware Ltd. (NASDAQ:RDWR)
A10 Networks Inc (NYSE:ATEN) invested in sales, marketing and research development teams to develop, market and sell its products. The company plans to continue to invest significantly in these areas in the future. According to the company, it needs to generate and sustain revenue growth, manage its cost structure, and prevent significant liabilities to achieve profitability in the future.
IPO gains trails peers
The performance of the shares of A10 Networks Inc (NYSE:ATEN) in terms of gains during its first day of trading is behind its peers in the industry amid the bullishness in the IPO market. Investors have been accumulating stakes in such tech companies going public based on growth rates, predictable sources of revenue and expectations of abilities to tap new areas in the technology industry.
One of its peers in the industry such as Borderfree Inc (NASDAQ:BRDR), which also started trading on Friday achieved more than 19% gain from its $16 offering price to $19.14 per share. In fact, the company reached as high as $21.25 a share today. Castlight Health Inc (NYSE:CSLT) soared more than 149% during its IPO last week.