Disappointing 10-Q Crashes Quantum Corp (NYSE:QTM)

[[tagnumber 0]][[tagnumber 1]]It has been two weeks since Quantum Corp (NYSE:QTM) took a serious hit for publishing less–than–stellar preliminary figures from its pending 10–Q report. The stock lost 23% in value on July 16 and has so far been unable to rebound. The actual Q1 2016 figures announced yesterday only further cemented the striking difference between what analysts expected and what the data storage service provider achieved.[[tagnumber 2]] [[tagnumber 0]][[tagnumber 4]]Shortly after market close yesterday, QTM held a conference call to discuss earnings for the quarter ended June 30, 2015. Raking in $110.9 million in revenue, the company marked a $17 million decrease from the same quarter in 2014. Net losses also surged, from $4.3 million to $10.8 million over the same time period. Given that the main hit occurred on July 16, QTM closed the most recent session at $1.19 per share, down 0.83% from the day before, shifting a volume of less than 2 million.[[tagnumber 2]] [[tagnumber 0]]Quantum‘s President and CEO Jon Gacek has attributed the aforementioned numbers to outside factors. While this may be exactly the case, we have yet to see how the management will continue to develop the company‘s scale–out storage services, the division whose revenue gre the most during this quarter.[[tagnumber 2]] [[tagnumber 0]]Over the long term, analysts seem optimistic about Quantum, expecting its business to grow by 20% per annum through 2019. As far as the short term is concerned, however, there has been a huge short interest in the stock over the last 12 months averaging 16 million short sold shares. Compared with a volume mostly ranging from 1.5 to 2 million, this makes for a fairly long days–to–cover ratio of ten days or more. Given that the stock is already quite oversold from a technical standpoint, closing out a position on time could prove difficult for each and every shorter.[[tagnumber 2]] [[tagnumber 0]]Whether the general storage market will improve over the new quarter will become clear in the next 10–Q. In the meantime, positive corporate updates might be just what investors will need to change their expactations on the stock.[[tagnumber 2]]