Linux is only bright spot as Novell reports loss

Sales of Linux products provided the only area of growth for Novell in its fiscal year ending 31 October 2009, as the vendor reported a decline in revenues....

Sales of Linux products provided the only area of growth for Novell in its fiscal year ending 31 October 2009, as the vendor reported a decline in revenues.

Overall sales fell by 10% to $862m and Novell recorded a loss of $213m, primarily due to a $279 charge relating to goodwill and intangible assets.

Novell was unwilling to provide any further details on the charge of $279m until it files a 10-K in the next few weeks. While Linux product sales rose 21% in 2009, the identity and security management, systems and resource management and workgroup product segments all recorded declines in the year.

President and CEO Ron Hovsepian admitted the company had experienced "a challenging year in terms of revenue", but said it had worked hard on improving its cost structure, delivering innovative solutions and expanding its partner ecosystem.

"As we move into 2010, we will focus on invoicing growth as we pursue opportunities in our current markets, as well as new opportunities in the emerging market of Intelligent Workload Management," he added.

The vendor forecasts net revenue of between $200m and $210m in its first quarter of 2010 and non-GAAP operating margin of around 14% to 16%.

A version of this story appeared on Microscope.

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