This summary is based on the first quarter fiscal 2009 earnings call conducted by TIBCO Software Inc. (TIBX) on March 26, 2009.
Management:
-
Chairman and CEO: Vivek Ranadivé
-
COO: Murray Rode
-
EVP and CFO: Sydney Carey
Key Investors Issues
- Total revenue was $132.9 million, down 9% year-over-year.
- Earnings were $5.6 million or 3 cents a share, down marginally from $5.5 million or 3 cents a share a year ago.
First Quarter Highlights
Total revenue was $132.9 million, down 9% year-over-year from $146.6 million as license revenue was down 22% to $44.8 million, while services revenue was $88 million, essentially flat with last year.
- The firm did see a sequential decrease in professional services and training revenue as projects were slower to begin than in past year.
- In terms of deal activity, TIBCO had 11 deals over $1 million in license versus 14 a year ago.
- At $595,000, the average deal size for transactions over $100,000 remained fairly consistent with last year.
- New license customers numbered 49 in the quarter, which is up from 30 a year ago.
From a geographic perspective, Americas revenue was 53%; Europe, Middle East and Africa 39%; and Asia Pacific 8%.
- From a vertical market perspective, total revenue was as follows; Financial services 19%, telecommunications 16%, government 11%, transportation and logistics 7%, energy 7%, and life sciences 7%.
- Year-over-year there was a shift away from financial services with new growth in government, media, transportation and logistics, and telco.
- Some key customer wins included Abu Dhabi Commercial Bank, International Flavors and Fragrances, The Nielsen Company, State Compensation Insurance Fund of California, UBS, United Airlines, and Wyndham Hotels and Resorts.
- From a product perspective, the breakdown of license revenue among major product families was as follows: SOA 64%, business optimization 21%, and BPM 15%.
Gross margins were 75%, up from 74% last year and operating income was $21.9 million, up $3 million or 16% from the same period a year ago resulting in operating margin at 16.5% versus 13.0%.
- The firm continued to carefully manage expenses and profitability, with expense reductions including salary-related costs, restricted hiring, and some seasonally lower contractor expenses.
- Earnings were $5.6 million or 3 cents a share, down marginally from $5.5 million or 3 cents a share a year ago.
- Firm ended the quarter with approximately $293 million in cash and short-term investments and DSOs came in at 72 days as compared to 70 days last year.
- Deferred revenue, including both long and short-term components, totaled $158 million, up 6%.
Operational Highlights:
- Leading companies continue to rely on the firm as the foundation for mission-critical systems, helping them both save IT cost and drive new revenue.
- It continues to see an important shift through in-memory high-performance computing systems, despite the macroeconomic issues.
- The emergence of the cloud computing model heralds a new emphasis on infrastructure as the increasingly important foundation for deploying services, integrating systems, and automating business processes across platforms.
Second Quarter 2009 Outlook:
- Total revenue to be in the range of $138 million to $143 million and license revenue to range between $50 million and $54 million.
- Operating margin is expected to be between 16% and 17%.
- EPS should range from $0.03 to $0.04 with an assumed tax rate of 31% to 33%.
Key questions and answers from the first quarter earnings call conducted by TIBCO Software Inc. (TIBX) on March 26, 2009.
John DiFucci (JPMorgan Securities Inc.):
Did maintenance grow year-over-year? And what did it do sequentially?
Sydney Carey: Maintenance did grow year-over-year and it also grew sequentially on the period.
John DiFucci (JPMorgan Securities Inc.):
Can you talk about that upcoming product cycle?
