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» Compuware's CEO Discusses Q2 2012 Results - Earnings Call Transcript
» Compuware's CEO Discusses Q1 2012 Results - Earnings Call Transcript
I will now turn the call over to Bob, who will provide a summary of the quarter's results. Joe will then highlight business unit operating results, followed by Laura, who will close the key -- with key financial information. We will then open the call to your questions.Bob? Robert C. Paul Thanks, Lisa. The sole focus of tonight's call is to give our investors a clear and transparent understanding of Compuware's current business conditions and future expectations. To begin, I will provide an overview of the progress of our business units. As we discussed last week, our total APM revenues increased 16% sequentially and 16% year-over-year in Q3. This is healthy growth but simply not as much as we expected. Last quarter, we talked about a number of changes Compuware made to its APM organization. These changes, including multiple levels of leadership and process change, give us more focus around our individual solutions. This is already positively impacting our APM business where we will see steady improvement of our growth rates. For Q3, our APM guidance was based upon a solid sales pipeline and commit. Up to the last few days in the quarter, we had enough committed to the sales activity to achieve our APM expectations. This end-of-quarter drop highlights a number of key opportunities for improvement. Our APM number is getting very close to forecast in all geographies other than Asia. This area remains an important emerging market for us. We will continue to invest here, but we will be more cautious and disciplined in understanding the makeup of our sales commit. We have also made changes in our Asia leadership. Ultimately, we must improve our forecasting discipline and accountability. Following sales leadership meetings last week, this discipline has been refined and reinforced, which should improve the accuracy of our business outlook. One of the many changes we've implemented is to subdue the potential impact of our larger deals in the forecast. This means that if large deals push, we will have an opportunity to make up for them with other wins.
Another priority is stepping up our sales productivity. The team is working on a number of initiatives with particular focus on knowledge and enabling programs to help differentiate between our specific APM solutions. Each of our APM solutions, the Gomez SaaS, dynaTrace and on-prem presents best-in-class solutions for highly related but functionality different problems.With growth opportunities in each category, a focused solution-specific sales team is a requirement for leveraging our competitive strengths today. And each of the APM solutions has an important role in our vision for a disruptive and seamless value proposition for managing performance from the end-user to the data center. We face no macro impediments to our APM success. For example, we've achieved consistent growth in partnered business from all geographies. More than half of the top 50 are under contract for our APM solutions, and global partners like Cisco and BT continue to contribute meaningfully to our results. We've seen a modest increase in customer signature requirements, which is a slightly lengthened sale cycle. The competitive environment remains the same, but Compuware is the recognized leader for both current and next-generation APM. So with the right structure, process and a sales toolkit in place and with no major macro headwinds, the key remaining driver of our AMP success is more activity, more pipelines and more diligence around closing. These are straightforward execution issues, and we've empowered our new APM leadership team to attack them. In Q3, we introduced John Van Siclen as the new head of our APM business unit. John and our new worldwide leader for APM sales, Eric Fischer, are passionately focused on sales discipline, cost optimization and customer value. We believe that under their leadership, our Q4 year-over-year revenue in APM will grow from 20% to 25%. Read the rest of this transcript for free on seekingalpha.com