SecureWorks, formerly the cybersecurity arm of Dell, which is itself owned by Silver Lake, debuted on the NASDAQ on Friday under the symbol SCWX, becoming the first technology company to hit the public markets in the U.S. this year. The numbers behind its IPO and first day of trading, though, may not necessarily encourage others to follow SecureWorks’ lead.
The company sold 8 million shares at $14 apiece, raising $112 million in the process. Initially, SecureWorks had sought to sell 9 million shares somewhere between $15.50 and $17.50, where a midpoint pricing would've raised $148.5 million. One likely reason for limited investor demand is the company’s recent performance. SecureWorks reported $72.4 million in net losses for its fiscal 2016 and forewarned in its prospectus that it may not achieve profitability. The company’s share price rose as high as $14.59 Friday morning but quickly declined, dipping as low as $13.76 during the afternoon before rallying to close the day back at an even $14.
Some believed a boffo debut could be a bellwether for more tech IPOs in the not-too-distant future. Instead, SecureWorks’ opening day on the market seems more likely to serve as another data point to demonstrate the market’s current malaise.