Novell Shifts to Profit

The company's results come in just under analyst estimates.
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Novell (NOVL) swung to a third-quarter profit as revenue was helped by a previous legal judgment and a boost in maintenance and services.

The company, which develops software for Linux updates, said after the bell Thursday that it earned $23.4 million, or 6 cents a share, compared with a loss of $12.4 million, or 3 cents a share, a year earlier.

Excluding special items, the company earned $14 million, or 4 cents a share. This was just under the Thomson First Call expectation of 5 cents a share.

Revenue rose to $304.6 million from $282.8 million, as the company recognized a $14 million payment from Canopy Group as part of a legal judgment. In addition, foreign currency exchange rates contributed about $5 million to revenue in the latest quarter.

New software-license revenue fell to $58.7 million from $69.3 million, but this was more than offset by an approximately 15% jump in maintenance and services revenue, which grew to $245.9 million from $213.6 million.

Overall, third-quarter revenue came in just below analysts' estimates for $306.6 million for the quarter.

Novell's shares were recently down 3.8% in after-hours trading after closing the regular session down 16 cents to $6.39.