Count Quantum Corp. among the big winners in the first round of funding doled out by the U.S. Small Business Administration’s Paycheck Protection Program.
The San Jose-based video data storage company received the maximum allowable amount under the program — $10 million — even though its business doesn’t appear to be bracing for a significant financial hit from the COVID-19 pandemic.
On April 6 — 10 days before Quantum applied for help from the PPP — the company told investors it expected revenue for the fourth quarter ending on March 31 would fall to $87 million from the previous estimate of $90-$100 million.
“Quantum equipment is relied on in disaster and crisis situations, and our solutions are core to many of our customers’ business continuity. As a result, we remain confident we have a business model that can weather the delays and disruption of a challenging pandemic,” Quantum CEO Jamie Lerner said at the time.
While bracing investors for production and shipping delays, Lerner signaled that the pandemic might actually be good for business.
“We also believe this crisis will be a driver for significant innovation,” Lerner continued.
The PPP was set up to help businesses with less than 500 workers cope with the COVID-19 pandemic. Quantum has 800 employees, with 550 working in the U.S. The company maintains the PPP loan is saving jobs.
“Without it, we would most certainly be forced to reduce headcount,” a company spokesperson told KQED in an email. “We owe it to our employees, who’ve stuck with us through a long and difficult turnaround, to do everything we can to save their jobs during this crisis.”
Quantum said it qualified for the program because it is classified as a computer storage device manufacturing company, in which the cutoff is 1,250 employees.
