Apr 23, 2002 (08:04 PM EDT)
BroadVision Adds To Flow Of Red Ink In Software Market
Read the Original Article at InformationWeek
Software companies continue to bleed red ink, with BroadVision Inc. being the latest to report quarterly earnings that indicate a significant scaling back in companies' software purchases. Given that the vendor of portal, content, and commerce applications saw license revenue drop year over year by 81% while overall revenue fell 67%, it's no surprise that the earnings were accompanied by the announcement of a major restructuring that coincides with the unveiling next month of its One-To-One 7.0 suite.
With the product launch, the company, which traditionally has positioned itself as a provider of enterprise self-service applications, will begin focusing on its business portal technology, which it has deemed as having the most broad-reaching business value among its existing and potential customers. Its commerce and content apps will be packaged with the portal-building tool, and the suite of apps will be offered in a variety of flexibly priced configurations, allowing for small-scale deployments, CEO Pehong Chen told analysts Wednesday during a conference call.
Meanwhile, with revenue goals adjusted for the ongoing slump in the software sector, BroadVision will eliminate 300 positions during the current quarter, or more than 30% of its 970 employees. It's also renegotiating lease terms for facilities it no longer needs and is searching for a chief operating officer to help guide the company's attempt to return to profitability by the end of the year, Chen said. The job cuts will come mostly in sales, which he said is too large in light of the company's realigned sales projections.
The new product strategy is designed to help BroadVision provide customers with quicker implementations and reduced integration costs and to let them leverage existing IT investments. Chen says the flexible pricing geared toward modular deployments also will let BroadVision sell directly to lower-level decision makers who can approve IT purchases related to specific projects.
For the quarter ended March 31, BroadVision reported a loss of $36.1 million on revenue of $30.5 million, compared with a loss of $105.1 million on revenue of $92.7 million last year. The year-ago loss included a $66.3 million charge for amortization. License revenue was a paltry $8.2 million, down from $43.1 million a year ago, as the company signed just 13 new license customers during the quarter.