Friday, October 26, 2007

SOFTWARE

Third-quarter profit at Vignette down on weak license revenue

Lower-than-expected license revenue pushed Vignette Corp.'s net income in the third quarter down 7.2 percent and revenue down 11.7 percent compared with a year earlier.

The Austin company, which sells software for managing content online, reported net income of a little more than $3 million, or 11 cents a share, on revenue of $43.5 million. Excluding nonrecurring items, the company earned 21 cents per share, beating the consensus of estimates of analysts polled by Thomson Financial Network.

That compares with net income in the third quarter a year ago of just under $3.3 million, or 11 cents a share, on revenue of $49.3 million.

Chief executive Michael Aviles said that after four consecutive quarters of strong results, the company experienced a "significant" shortfall in license revenue.

The company said it expects fourth-quarter revenue to be between $45 million and $50 million and net income to be in the range of 9 cents and 15 cents per share.

Results were released before the market opened. Vignette shares closed up 86 cents, at $17.56 cents a share.

TESTING SOFTWARE

National Instruments sees record revenue; income up 15%

National Instruments Corp. shook off slower spending by manufacturing and industrial customers to post record revenue in the third quarter.

The Austin company said revenue increased 12.4 percent from the same period last year, from $164.1 million to $184.4 million. Net income increased 15 percent, to $21.5 million from $18.7 million. Earnings per share rose to 27 cents from 23 cents.

Analysts had expected 28 cents a share.

The company's shares fell 64 cents, almost 2 percent, to close regular trading at $33.05 Thursday. Shares fell another 4 cents in after-hours trading following the earnings report.

National Instruments' results often follow the trend of the global Purchasing Managers Index, a key gauge of industrial spending. The index dropped sharply during the third quarter, pulling down National Instruments' sales of traditional test and measurement products.

Sales of newer technologies have helped the company start to move away from that pattern, and those products helped push the average order size to roughly $3,400 in the quarter, a record, said John Graff, vice president of marketing and customer operations.

National Instruments said it expected its operating margin — essentially its profit before taxes, depreciation and other accounting items — to reach between 17 and 18 cents per each dollar of sales. The company had set a target of 18 percent operating margin for 2008 but hopes to come close to that by the end of this year.

"That puts us in great position for 2008 to say, 'Now, where do we make strategic investments to drive the acceleration of our revenue growth?' " Graff said.

Compiled from staff reports

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