BEA Systems Posts Strong Results

Looking ahead, BEA expects first-quarter revenue to range from $260 million to $270 million, with license revenue ranging from $127 million to $132 million. Analyst estimates pegged first-quarter revenue at $259.4 million, with license revenue at roughly $130 million.

The company did not give explicit earnings guidance but analysts said implied guidance called for earnings meeting the consensus estimate of 8 cents a share. In a telephone interview, CEO Alfred Chuang said the company is figuring earnings will come in slightly above that, in the 9-cent range. "We saw great momentum" in the fourth quarter, Chuang said.

About six months ago, amid tight competition from IBM(IBM Quote - Cramer on IBM - Stock Picks) and Oracle(ORCL Quote - Cramer on ORCL - Stock Picks) in its maturing application server space, BEA made a bet-the-farm move by expanding its core product into a platform that also includes integration, development tools and portals.

Investors had been disappointed by the lackluster results since then, but BEA offered some hints Thursday that integration finally may be taking off.

Integration sales climbed 40% sequentially to ring in at more than $30 million in the fourth quarter and more than $100 million in the fiscal year. Revenue from BEA's new platform, called WebLogic 8.1, accounted for 11% of sales.

"I would expect people would be somewhat encouraged by this [report]," said Sanford C. Bernstein analyst Charlie Di Bona, who called the fourth quarter solid. "But the real acceleration of the company is in the second half of the calendar year."

That's because it will take until then to achieve wider adoption of BEA's new platform and spending to loosen up, explained Di Bona, who has an outperform rating on BEA. His firm doesn't do investment banking but its parent, Alliance Capital, holds BEA shares.