06.02.08

Gemini version available ♊︎

Novell’s Financial Hocus Pocus: How Poorly is It Really Doing? (Updated)

Posted in Finance, GNU/Linux, Microsoft, NetWare, Novell, SLES/SLED at 5:12 am by Dr. Roy Schestowitz

“Novell is dying,” concludes one man

One issue worth exploring is future prospects of Novell. The company is still in a state of gradual transition.

There are 12 of us at the moment in the IRC channel ( #boycottnovell @ FreeNode ), which has just been formally registered. One subject that was willingly brought up is Novell’s latest financial report, which we mentioned a couple of times last week [1, 2].

Here is last year’s annual report (published in December 2007) and the corresponding document on the SEC’s Web site. Also consider this quick analysis, which basically showed us that Novell pays Microsoft for SUSE sales that it makes, based on volume. Here are some notes about the report from March 2008 and here is the latest report, or at least a synopsis (truncated documented). The full report can be found and read here (free registration required).

Beneath the surface you already find some similar responses to ours, e.g. from LinuxToday:

I’d love to know how Novell is going to replace several hundred million dollars of revenue around Netware, which Microsoft is systematically having for lunch, with a pitiful thirty million dollar Linux business that Red Hat wouldn’t get out of bed for. You do the math.

Personally, I seriously doubt the revenue increase claims, because Novell’s Linux business has been treading water around that figure for a few years now. Any revenue increase on such a small figure when compared with their historical Netware revenues (which they have to replace), and those of other companies Novell thinks it competes with, such as Red Hat, are just insignificant.

Further, it says:

Microsoft is not a partner [of Novell]. It’s a very direct competitor, and the reason why Novell went cap in hand to Microsoft is because they can’t compete, they don’t have any idea of the first thing to do to try and compete and they simply want Microsoft to stop taking them to the cleaners. This was all they could come up with to make it stop.

Another person takes a look at the hard numbers

Looking at the “Total net revenue”

2008 – $235,666
2007 – $232,387

Which is good. It is an increase. But it’s an increase of:
$3,279.

Now, the claim is:
29 = x + .31x
29 = 1.31x
22 = x (approx)

So Novell’s Linux segment earned $7 million MORE than last year …

And every other segment is doing good, too …

But the total increase is LESS than the increase of Novell’s Linux segment.

Which really doesn’t make any sense. In order for the total to be less than one of the segments, at least one of the OTHER segments has to be doing worse than last year.

[...]

Someone later jumped in to defend Novell, but the argument backfired because it did not correspond to simple facts.

Yes. And unlike you, I know what “Workgroup product” means. That’s NetWare. Their largest revenue stream is dying.

So a 1% loss in NetWare almost completely offsets a 31% gain in SuSE.

Novell needs to get customers for their Linux product as fast or faster than they lose them from NetWare. And Novell is not doing this.

[...]

If Novell is not gaining market share, then Novell is doing nothing more than milking existing customers.

At best that means that Novell is stagnant.

Otherwise, it means that Novell is dying.

Novell is dying.

Going back to the start, it was Asay who generated the buzz about Novell doing well (a claim backed by Novell’s embellished reports). Looking at his own blog last night, you find this. Given the growth he has been boasting for a long time and also the audiocast where he said that everyone plays the 'bucket game' (including Novell), this just doesn’t seem right.

Update (03/06/2008): This one comes from a notorious author, but it sheds some more light.

Novell made $5.87 million, or two cents a share, in its second fiscal quarter ended April 30 on flat revenues of $235.7 million, up only ~$3 million. A year ago it lost $2.9 million, down a penny.

Legal and R&D cost it $4.5 million.

On a non-GAAP basis, income from operations for the second fiscal quarter 2008 was $16 million versus $9 million last year.

The company’s product revenue from Open Platform Solutions, almost all of it Linux, came to $30 million, up 31%.

Service revenues were down 19% to $41.1 million.

Share in other sites/networks: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Reddit
  • email

Decor ᶃ Gemini Space

Below is a Web proxy. We recommend getting a Gemini client/browser.

Black/white/grey bullet button This post is also available in Gemini over at this address (requires a Gemini client/browser to open).

Decor ✐ Cross-references

Black/white/grey bullet button Pages that cross-reference this one, if any exist, are listed below or will be listed below over time.

Decor ▢ Respond and Discuss

Black/white/grey bullet button If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

DecorWhat Else is New


  1. Is Linus Trolling the GNU/Linux Community?

    This new video responds to what many sites have been provoked into amplifying



  2. Links 27/11/2021: Tux Paint 0.9.27 and SeaMonkey 1.1.19 in EasyOS

    Links for the day



  3. [Meme] Keeping Our Distance From Microsoft

    The OSI is the dagger, the Linux Foundation is the knife, and many others are the sword by which Microsoft tries to get into the very heart of GNU/Linux and extinguish the Free software movement



  4. Microsoft Edge Encourages Indebted Americans to Guilt-spend Just in Time for Christmas

    Guest post by Ryan, reprinted with permission



  5. IRC Proceedings: Friday, November 26, 2021

    IRC logs for Friday, November 26, 2021



  6. 38+ Years of GNU and 19+ Years of FSF Associate Membership

    “On November 25, 2002,” Wikipedia notes, “the FSF launched the FSF Associate Membership program for individuals.” As the above video points out, it all started almost 40 years ago.



  7. Gemini as a Platform for Gamers

    Contrary to what people often assume (or are led to assume), even without client-side scripting Gemini can accomplish a great deal; early adopters, many of whom are technical, test the limits of the very minimalistic (by design and intention) specification



  8. Improved Workflows: Achievement Unlocked

    Today we've completed a bunch of small projects that can make us more efficient (e.g. more Daily Links per day, more articles); the above video was recorded many hours ago to accompany the outline below



  9. Links 26/11/2021: New Complaint About Microsoft Competition Crimes in Europe, EuroLinux 8.5, GhostBSD 21.11.24, and Kiwi TCMS 10.5 Released

    Links for the day



  10. Links 26/11/2021: F35 Elections, Whonix 16.0.3.7, OSMC's November Refresh With Kodi 19.3

    Links for the day



  11. IRC Proceedings: Thursday, November 25, 2021

    IRC logs for Thursday, November 25, 2021



  12. IRC Proceedings: Wednesday, November 24, 2021

    IRC logs for Wednesday, November 24, 2021



  13. Links 25/11/2021: PHP 8.1.0 Released and Linux 5.15.5

    Links for the day



  14. IBM as Master of Hypocrisy

    Free software projects and Free software developers have long been humiliated by corporations of Western misogynists, falsely claiming that the Free software community isn’t inclusive enough (these are shameless projection tactics; as a matter of public record, the exact opposite is true) and even the eradication of supposedly offensive language isn’t something IBM takes seriously



  15. Links 25/11/2021: LibreOffice 7.2.3 and Mesa 21.2.6 Released

    Links for the day



  16. [Meme] So Desperate That Edge Cannot Even Exceed 4% That They Block Rival Web Browsers

    Linux/Android/Free Software/GNU (they go by very many names/brands) may continue to grow to the point where Windows is as irrelevant as Blackberry; this means that Microsoft’s grip on the Web too has slipped — to the point where Microsoft frantically uses 'bailout' money to hijack LinkedIn, GitHub, etc. (it also rebrands almost everything as "Azure" or clown to fake a perception of growth)



  17. Windows Vista Service Pack 11 (Vista 11) Has Failed to Curb the Growth of GNU/Linux

    Windows market share continues to decrease in spite of billions of dollars spent bribing the media for fake hype, especially in light of a new Windows Service Pack (SP), Vista SP 11



  18. Links 25/11/2021: Proton 6.3-8 and Linux Mint Compared to Ubuntu

    Links for the day



  19. 3.5 Years Later the 'Master' of Fedora is Still Microsoft and IBM Cannot Be Bothered to Alter Git Branch Names (Refuting or Ignoring Its Very Own Directive About Supposedly Racially-Insensitive Terms)

    Today we demonstrate the hypocrisy of IBM; years after telling us that we should shun the term "master" and repeatedly insisting it had a racist connotation at least 65 Fedora repositories, still controlled by Microsoft, still use "master"



  20. Changing the Arrangement While News is a Bit Slow(er)

    I've made it easier for myself to keep abreast of things like IRC channels and networks (incidentally, a day ago Freenode reopened to anonymous logins) and I've improved monitoring of the Web sites, Gemini capsule etc. (this video is unplanned and improvised)



  21. Links 24/11/2021: Alpine Linux 3.15 and Endless OS 4.0 Released

    Links for the day



  22. [Meme] Jimmy Zemlin Loves Microsoft

    It’s funny, isn’t it? Lying for a living and sucking up to the liars pays off; you get to plunder actual Linux users while leaving Linux morally and financially bankrupt



  23. Links 24/11/2021: PHP Foundation and Flatpak Criticisms

    Links for the day



  24. IRC Proceedings: Tuesday, November 23, 2021

    IRC logs for Tuesday, November 23, 2021



  25. Links 24/11/2021: Rust Crisis and Team UPC Still Faking 'Progress'

    Links for the day



  26. Links 23/11/2021: New GNU Parallel and Memories of David H. Adler (Perl, Raku)

    Links for the day



  27. In Light of Fast-Accelerating Deterioration -- Sometimes Weaponisation -- Getting Off the World Wide Web (to the Extent Feasible) Makes You Saner and Less Susceptible to Manipulation, Lies

    Almost no sites are speaking about it (probably because they have no presence on the Internet except on the Web), but it's time to motivate more people to get off the Web, for their own good and for society's sake...



  28. Black Friday SPAM on the World Wide Web: A Reminder That the Web is a Dying Platform, Languishing Due to Marketing and Misinformation

    The junk that overruns the Web this 'Black Friday' week (consumerism 'on steroids') is a good reminder that the Web isn't healthy for the mind anymore; it's mostly spying on people, trying to compel them to buy particular things or vote a certain way



  29. Microsoft-Led Misinformation Campaign About Germany and Munich Reminds Us That Microsoft Hates and Actively Undermines GNU/Linux Adoption

    Regarding the latest moves to GNU/Linux in Germany we have 3 points to make



  30. Links 23/11/2021: Libreboot 20211122, Deepin Linux 20.3, Amazon Linux 2022, and Mabox Linux 21.11 Released

    Links for the day


RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

Recent Posts