The application server maker BEA Systems has returned revenue
figures broadly in line with industry estimates.
The California-based software company posted earnings of 10 cents
(7p) per share - one cent per share better than had been predicted
and twice last year's dividend - for the quarter to 31 July.
The company, which said the encouraging results were largely a
result of growth in the sales of its flagship software products
such as WebLogic Server, confirmed a decision to reduce revenue
forecasts for the second half of the year as a result of the
ongoing worldwide slump in IT spending.
Excluding charges, net income for the second quarter totalled
$43.9m, an increase of 101% compared to the corresponding period
last year.
Taking into account costs for acquisitions, employer payroll taxes
on stock options and net gains on investments in securities, BEA
reported net income of $23.9m for the quarter. Quarterly revenue
benefited from 44% year-on-year growth, up from $186m to $267.8m.
In spite of the figures, BEA announced plans to reduce both staff
intake numbers and spending. The company's product line will also
see some diversification. The chairman and CEO of BEA, Bill
Coleman, said the changes were necessary in what he described as a
"challenging economic and IT-spending market".
BEA, which competes with IBM and Oracle among others, has already
forged a number of new partnerships in an attempt to increase the
base of consulting firms supporting its WebLogic Server platform.
An additional 6,000 consultants were trained on its software
products during the quarter.
BEA has also diversified the technology that its WebLogic Server
supports. In the latest release, Version 6.1, the Java-compatible
software was provided with additional support for Web services
standards such as SOAP (Simple Object Access Protocol) and WSDL
(Web Services Description Language).
The additional standards support should help BEA to grow its
business in the Java market as well as the emerging Web services
market, Coleman said.
Earlier this week, BEA's share price fell to its lowest level for
almost two years as the company struggled to convince investors
that it would meet its projected revenue estimates in future
quarters. Shares of BEA closed at $18.60 in anticipation of the
earnings announcement yesterday before gaining 3% in trading.
Coleman said, "It is prudent to adjust our short-term guidance to
be more conservative given the current business environment and
recent trends in information technology spending."