Business Not Bad for Three Software Makers
Three companies that make software for business were rising Wednesday after turning in better-than-expected quarterly results and voicing optimism about the current year.
Computer Associates rose 2% to $35.83 after reporting a 68% increase in pro forma net income to $417 million, or 71 cents a share. Thomson Financial/First Call had been looking for a profit of 60 cents.
Analysts said the upside surprise came from lower marketing costs, which hit just $457 million, compared with some estimates of $559 million."Due to the improvements in operating margin, we are raising our fiscal 2002 and 2003 earnings projections but leaving our revenue estimates essentially unchanged," said George Godfrey, an analyst at ABN Amro. Under generally accepted accounting principles (GAAP), net losses totaled $231 million, or 40 cents a share, compared with a loss of $342 million, or 59 cents a share, in the same period a year ago. Revenue fell to $749 million from $783 million a year ago, but sales from subscription-based fees, software and other fees rose 61% to $338 million. In a conference call, CEO Sanjay Kumar said he expects to report a fourth-quarter operating loss of between 4 cents and 5 cents a share on revenue of about $770 million, under generally accepted accounting principles.
EncouragingSoftware maker Compuware also delivered solid results last quarter, topping analysts' estimates by 2 cents amid strong growth in mainframe software. The firm posted fiscal third-quarter earnings of $49.3 million, or 13 cents a share, excluding charges, compared with $46.7 million, or 13 cents a share, last year.
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