Good News From Wall Street
Pivotal Corp. today announced it has increased its licensing revenues by more than 100 percent and significantly cut operating costs in its second quarter of 2003, ended December 31, 2003. Also, Witness Systems announced record revenues for fiscal 2002, also ended December 31, 2003.
Pivotal's licensing revenue for the second quarter was $7 million, an increase of 118 percent compared to the first quarter. Total revenue was down slightly, however, coming in at $16.1 million, compared to $16.7 million in the second quarter of 2001.
But Pivotal's greatest success has been in operating efficiencies. The company has cut net loss for the quarter to $11.8 million, a drastic decline when compared to a second quarter 2001 net loss of $63 million.
Bo Manning, president and CEO of Pivotal, says the company is on target to become profitable in the third or early fourth quarter, and that he feels the company has the right strategy in place. "We are continuing to build out our product line, and Pivotal 5, which will be released in March, will greatly expand on all our service operations," Manning says.
Manning also notes that licensing revenues should continue to increase, because Pivotal plans to target not only the open market, but also existing customers. "We have 1,600 customers that license only one product," Manning says. "That presents a great opportunity for us to make significant new transactions."
Manning says Pivotal expects a customer lift, as Microsoft CRM will leave a lot of companies wanting more. He explains that the product is less functional than the previous MS offering, which was a Siebel Systems integrated solution. And Manning says that companies may be wary of Microsoft products, since they are often altered significantly before they mature. "Less functionality and the technology risk involved may shift midsize companies our way," Manning says.
Another company reporting strong gains was Witness Systems, which announced year-end revenues of $67.7 million, an eight percent increase over 2001. Fourth quarter revenues at Witness grew 16 percent to $17.4 million.
Like Pivotal, Witness managed to cut its losses over the past 12 months. In 2002 the company ended the year with total income of $48,000 after reporting a net loss of more than $5 million in fiscal 2001.
"Our results demonstrate solid execution and continued market leadership, especially considering the challenging IT spending environment over the past year," Dave Gould, CEO of Witness Systems Inc., said in a statement. "Over the course of the year our performance helped validate workforce optimization as a viable, growing market in which we have a sustainable competitive advantage with our eQuality software suite. As we begin 2003 we believe we are in a strong position to deliver long-term growth, and we're prepared to build on our success in the upcoming year."