Computer Associates Affirms Revenue Guidance

Computer Associates

(CA) - Get Report

expects its revenue for the fourth quarter, when calculated according to generally accepted accounting principles, to meet its prior guidance.

On a GAAP basis, the software company is planning to post revenue of $770 million for the quarter ended March 31. CA also expects its fourth-quarter operating loss, excluding amortization and a charge, to be narrower than anticipated. The company had been projecting a loss of 4 cents to 5 cents a share.

CA said new unearned subscription revenue for the fourth quarter will total around $650 million, representing a sequential increase of 17% from the December quarter.

The company expects cash from operations of more than $430 million for the quarter and more than $1.1 billion for the year. Cash from operations came to $354 million for the December quarter.

CA, which is being investigated by the

Securities and Exchange Commission

and the U.S. Attorney's office because of its accounting practices, has been under fire from critics for a year and a half since the company changed its revenue recognition policy. The fourth-quarter estimates could, however, provide some hope to software investors, who recently have seen a series of warnings from the sector, including lowered guidance from

PeopleSoft

(PSFT)

and

Check Point

(CHKP) - Get Report

.

In addition, Computer Associates is selling certain assets, mainly the supply chain management, financial management and human resource management product lines operating under the name interBiz, to SSA Global Technologies. Financial terms of the transaction weren't disclosed.