Updated from 4:46 p.m. EDT

Business Objects ( BOBJ) beat Wall Street's earnings expectations for the second quarter, but fell a bit short on the top line and issued disappointing guidance for the third quarter and the rest of the year, the company reported after the closing bell on Wednesday.

Shares were recently up 36 cents, or 2%, to $20.15 in after-hours trading; in the regular session, the company's stock rose a penny to $20.15.

In the June quarter, the French-owned software company earned a pro forma profit of $18.2 million, or 20 cents a share on revenue of $222.2 million. Analysts polled by Thomson First Call were expecting a profit of 18 cents and revenue of $224.61 million. On the same basis a year ago, the company earned $23.6 million, or 26 cents a share, on sales of $129 million.

According to generally accepted accounting principles, the company earned $11.4 million, or 13 cents a share. In the same quarter last year, the company earned $11.5 million, or 18 cents a share.

Looking forward to results for the third quarter, the company expects to earn between 14 cents and 18 cents per share on a pro forma basis, with revenue of $215 million to $220 million. Wall Street was expecting EPS of 21 cents on sales of $228.64 million.

For the full year, the company said to expect earnings of 80 cents to 85 cents a share on sales ranging from $905 million to $915 million. Analysts were projecting earnings of 86 cents on sales of $933 million.

The company blamed the strengthening dollar for the lower-than-expected revenue estimate, saying that currency will cut approximately $16 million from the top line. The remainder is due to caution in light of the tighter spending environment experienced throughout the software industry, the company said.

If you liked this article you might like

Microsoft Vista Outpaces Predecessor

Microsoft Vista Outpaces Predecessor

Microsoft Gets 20-Day European Reprieve

Microsoft Gets 20-Day European Reprieve

SAP Plans Oracle Fight

SAP Plans Oracle Fight

TechWeek: Pop Goes the Equity Bubble

TechWeek: Pop Goes the Equity Bubble

Microsoft Forms Ad Search Unit

Microsoft Forms Ad Search Unit