got hammered in premarket trading, falling more than 20% to $9.80 after announcing it would badly miss its September quarter revenue targets. The company had expected to bring in about $70 million for the period, but it now says investors should expect a range of $60 million to $63 million when it announces its third straight quarter of lower sequential revenue Oct. 28.
The San Jose-based maker of systems management software also warned it would be taking a charge against goodwill and other intangible assets, but it did not disclose the size or the reason for this action. In guiding lower, the company also announced that this would be the last quarter the company will be generating license revenue from
, bringing to an end a deal that will generate $5 million in the current quarter vs. $25 million in the year-ago period.
Management said it remained confident in its product strategy and sales force, but did not offer any guidance as to how the revenue miss would affect earnings or when it expects business to pick up. Analysts had been expecting the company to earn 3 cents per share for the quarter, off from 25 cents per share in the year-ago period.
The stock has been flat for the year as investors have been generally wary of enterprise software companies that are waiting for businesses to invest in new applications and hardware that require expensive systems management solutions. Competitor BMC Software
is down almost 25% since January, while and Quest Software
has been treading water for most of the year.