PeopleSoft will exceed estimates for license revenue, total revenue, and earnings-per-share for the quarter ended September 30.
Posted Oct 7, 2003
PeopleSoft announced that it will exceed estimates for license revenue, total revenue, and earnings-per-share for the quarter ended September 30. Earnings will exceed the company's already upgraded estimates made on September 4.
"When you offer customers better software, a choice of databases, and you build on their existing product investments, they buy more," PeopleSoft president and CEO Craig Conway said in a company statement.
On September 4 PeopleSoft announced at its annual analyst day that license revenue would be between $135 million and $150 million, and total revenue would be between $575 million and $590 million.
Steve Swasey, a spokesman for PeopleSoft, says that the J.D. Edwards acquisition has transformed the company into one poised for growth: "PeopleSoft is now a stronger company with the acquisition of J.D. Edwards. We have gone from a $2 billion company to a $3 billion company, and doing so extended our product reach, our industry reach, and our geographic reach. There is a new PeopleSoft in town."
The completed merger with J.D. Edwards will certainly add to the company's license revenues, but analysts feel that this quarter's spike may not be indicative of a long-term trend.
"We believe the real challenge for PeopleSoft is not achieving the 2003 estimates, but rather achieving the 2004 estimates," says Patrick Walravens, managing director and senior research analyst at JMP Securities LLC. "PeopleSoft is likely to struggle with integration issues as it merges with J.D. Edwards."
Even though Walravens stresses caution, Wells Fargo upgraded its rating from hold to buy yesterday based on the positive news. Final results and additional information regarding PeopleSoft's third-quarter performance will be released later this month. According to Swasey, at that time the company will provide a more specific picture of why revenues jumped in the quarter.
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