23 April 2004 Enterprise application software supplier PeopleSoft has reported revenue up 40% from a year ago to $643 million, a rise that was mostly due to the company’s acquisition of JD Edwards in 2003.
“We announced a growth objective for 2004 that was by far the most aggressive in the enterprise application software business, and we are delivering to that plan,” said CEO Craig Conway, although the results disappointed Wall Street, which had been expecting higher revenues.
In addition, net income fell 58% to $62 million from $378 million in the same period in 2003. The company blamed this on a handful of customer contracts that were not signed until the quarter ended. “Either of those would have moved our licence revenue to the upper end of our guidance,” claimed Conway.
Software licence revenue was nevertheless up 62% to $130.9 million. PeopleSoft executives cited improving economic conditions and increased corporate technology spending as the reasons behind that gain. “The overall economy seems to be improving and companies seem to be returning to normal business practices,” said Conway.
But he added that Oracle’s $9.4 billion hostile takeover bid for the company had acted as a distraction for management and contributed to the fall in net income. “We don’t have the use of both arms,” he said.
The US Department of Justice blocked Oracle’s hostile takeover in February on antitrust grounds, and the EC followed suit in March. Oracle, however, launched an appeal and continues to defend its case in both courts. Its US case will be heard in June.
Nevertheless, Conway described the distractions as being “now behind us… We can now return our full attention to our business”.