EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

02.28.10

Novell’s Financial Results Disappoint Again (Revenue Misses Expectations)

Posted in Finance, GNU/Linux, Novell, SLES/SLED at 5:58 am by Dr. Roy Schestowitz

novell-boat

Summary: A look at all the coverage we could find about Novell’s financial report from Thursday

LOOKING back at the past 2 weeks, we find that Novell’s results did not surprise for the better. Here is a roundup of some posts on the subject, latter parts being more relevant than the former.

The Week Before

A week and a half before the results came out there was nothing particularly interesting in the news. Novell was just mentioned in:

Stocks At 52-Week High (MAT, CAG, ARUN, NOVL)

Novell, Inc. (NASDAQ:NOVL) made a new 52-week high of $5.03 in the morning session. In the past one year, the stock has rallied over 47%.

SmarTrend research report available on Novell

Stocks At 52-Week High (MAT, CAG, ARUN, NOVL)

Novell, Inc. (NASDAQ:NOVL) made a new 52-week high of $5.03 in the morning session. In the past one year, the stock has rallied over 47%.

SmarTrend research report available on Novell (NASDAQ:NOVL)

SmarTrend, our proprietary pattern recognition system, called an Uptrend for Novell (NASDAQ:NOVL) on January 06, 2010 at $4.53. Since then, Novell has returned 9.9% as of today’s recent price of $4.98.

It didn’t last long.

Results’ Week

Things became a little more interesting days before the results came out, with coverage including:

Unusual Trading Activity for Novell Inc (NOVL)

Interesting Options Volume for Novell Inc (NOVL)

This Weeks Earnings on Wall St

Novell Broke Resistance

Novell near Resistance

Novell Closing in to Support

Results’ Time

Here is Novell’s press release and the transcript of the Earnings Call.

Coverage then included:

Novell Guides Revenue Below Estimates

Novell Ahead of Earnings

Gap, Safeway, Blackstone

Conference Calls Today: 5-5:30 P.M. EST

Stocks Poised For Weak Open

Assured Guaranty (AGO), Crocs (CROX), Fluor (FLR), Gap Inc. (GPS), LaSalle Hotel (LHO), Novell (NOVL) and Universal Health (UHS) are among the major companies that will report their quarterly results after the markets close for trading.

Wall Street Set For Higher Open

After the markets closed for trading in the previous session, software solutions provider Novell Inc. (NOVL) reported a higher profit in its first quarter, helped lower operating expenses, notwithstanding a decline in revenues. Earnings for the quarter were in line with estimates, but revenues fell short of expectations. Looking ahead to the second quarter, Novell expects sequential revenues to be flat.

Novell profit rises as sales slip 6%

Novell 1Q Earnings Match Street’s View; Revenue Falls

Novell Inc. (NOVL) saw shares fall slightly after the company said fiscal first-quarter earnings per share were in-line with the Street’s view, but reported worse than expected quarterly revenue.

Fluor cuts yearly forecast; Gap increases annual dividend

Novell shares slump after quarterly revenue outlook

[...]

Investors pushed Novell /quotes/comstock/15*!novl/quotes/nls/novl (NOVL 4.69, -0.01, -0.21%) shares down 1.3% to $4.75 after the business software provider said it expects second-quarter net revenue “to be similar” to first fiscal quarter that ended in January. Analysts had expected second-quarter revenue of $212 million. Novell reported first-quarter revenue of $202.4 million compared with $214.9 million in the year-ago period.

Looking ahead to Novell Inc. earnings; NOVL, ASIA, MFE, CHKP

Novell, Inc. Issues Q2 2010 Revenue Guidance Below Analysts’ Estimates

Novell, Inc. announced that for second quarter of 2010, it expects net revenue to be similar to first quarter of 2010 revenue levels. The Company reported net revenue of $202 million in first quarter of 2010. According to Reuters Estimates, analysts were expecting the Company to report revenues of $212.6 million for second quarter of 2010.

Novell Q1 Profit Rises

Earnings for the quarter were in line with estimates, but revenues fell short of expectations. Looking ahead to the second quarter, Novell expects sequential revenues to be flat.

Positive spin is not exactly justified.

Further Analysis

Here is an example of how to select statistics such that they support a point of view:

Novell Net Up 89% After 2008 Charges; Shares Down On View -NOVL

Novell Inc.’s (NOVL) fiscal first-quarter profit surged 89% on higher margins and fewer charges, as the software company posted lower revenue.

Novell posts 81% increase in Q1 profits – Regional

They compare a year of financial collapse to one that is less so. They also say nothing about the small margin, whose increase on an absolute scale is rather small. Here is what a Microsoft booster had to say and also another perspective:

Elsewhere, Novell Inc. (NOVL) reported first-quarter net income of $20.2 million, or 6 cents per share, on revenue of $202.4 million. Analysts had expected Novell to post a profit of 7 cents per share on $207.6 million in revenue. Options traders had high hopes for NOVL’s quarterly report, with the stock’s SOIR of 0.17 indicating that calls outnumbered puts by a factor of more than five to one. What’s more, this ratio arrives at an annual low, meaning that these speculative investors have not been more bullishly aligned during the past year.

Here is what Novell boosters had to say, looking at just one portion of the business in isolation:

Novell: Still Looking for its Mojo

Novell’s latest quarterly financial results, revealed today, were a mixed bag for the SUSE Linux provider. Novell made progress in some areas. But didn’t really thrive in others. Where does the company go from here. The answers will likely surface at the Novell BrainShare 2010 conference (March 21-25, Utah), where Novell will strive to energize channel partners and customers? In the meantime, here’s a look at Novell’s current business condition … through the eyes of The VAR Guy.

Novell’s SUSE Linux Milestone: Proper Perspective

Initially, The VAR Guy wasn’t all that impressed with Novell’s latest financial results, announced Feb. 25. But our resident blogger overlooked one important fact: Novell’s SUSE Linux business is now break-even. That’s an important milestone — but what does it say about the broader open source industry’s march to profitability? Here are some clues.

There is a picture of a scale there, with people on one side and cash on the other. GNU/Linux in general is growing rapidly, but Novell broke even only after SUSE layoffs which cut expenses down. “Microsoft Deal Slumps,” claims Sean Michael Kerner and Timothy Prickett Morgan more or less agrees with him about Novell’s Ballnux business breaking even.

For the quarter, Novell continued its trend of ever-shrinking overall sales as its legacy NetWare operating system and GroupWise collaboration software business declines faster than SUSE Linux support revenues can fill in the gap. Total revenues for the quarter came to $202.4m, down 5.8 per cent, with software license sales plummeting 25 per cent to $21.2m (largely because of NetWare declines).

Days Afterwards

As the following chart hopefully shows, Novell’s stock responded negatively to Thursday’s report. It fell on Friday.

NOVL results in 2010

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

10 Comments

  1. JohnD said,

    March 1, 2010 at 11:52 am

    Gravatar

    And once again you continue to show us how you can select information to support your point of view as well Roy.
    This quarter’s revenue was made without an additional 25 million from M$. The basic math will show that revenues did not drop by 25 million they dropped around 12 million – less than half. Which means they actually increased their own sales by approx. 13 million. That’s not bad. At the same time you trivialize the operating margin increase by having a margin of 10.6% in this economy is pretty darn good. Improved profit margin – improving sales (outside of M$) and no major changes to cash on hand – Novell is not circling the financial drain as closely as you would have people believe. I would also point people to the significant improvement in investing performance – a swing from a loss of 40 million last year to a gain of 12 million this year. That’s good stuff.
    I will say that this financial “review” is far more balanced than previous ones.

    your_friend Reply:

    There’s a lot of talk about Novell being bought today. It will be good to see Roy’s analysis of this. Looks like they Novell be just like SCO sooner than later, that is down the drain. A company that has a major competitor like Microsoft is a major source of funding is company in big trouble.

    Roy Schestowitz Reply:

    Yes, there is a lot to be said about it.

  2. JohnD said,

    March 1, 2010 at 3:16 pm

    Gravatar

    Isn’t funny how my last submission didn’t seem to get posted?

    Roy Schestowitz Reply:

    Isn’t funny how my last submission didn’t seem to get posted?

    Akismet flagged it.

    http://akismet.com/

    JohnD Reply:

    Why?

    Roy Schestowitz Reply:

    I really don’t know. It’s an external service from WordPress, one that I don’t control. It puts many other comments in the queue (among about 100 spam/day).

    JohnD Reply:

    Perhaps my name isn’t original enough. Thanks for the info.

  3. Roy Schestowitz said,

    March 1, 2010 at 6:48 pm

    Gravatar

    And once again you continue to show us how you can select information to support your point of view as well Roy.

    I put here every single article that I found.

    JohnD Reply:

    Yes you did, which is probably the biggest reason it’s more balanced than others, but it was this comment:
    ‘They compare a year of financial collapse to one that is less so. They also say nothing about the small margin, whose increase on an absolute scale is rather small.’
    And how you organized the “supporting” articles that I was referring to. You continue to remark that Novell is in “financial collapse” while it’s public accounting records continue to refute your claims.
    I realize your goal is to focus on any negative aspects of Novell to support your cause, but I will continue to take issue with statements that I feel are false or misleading. As I stated this summary of the financial report was much more balanced than the others you have done. What I’m not sure about is why. It may be that it was an honest attempt at being balanced or it may be that there just wasn’t enough “dirt” this time around. I’m hoping for the former. Once again you did a good job of collecting related articles on this subject. Thanks for posting the links to them so readers can come to their own conclusions about the content.

What Else is New


  1. Links 26/11/2014: Docker Patched, New DragonFlyBSD

    Links for the day



  2. Message to the Corporate Media: Bill Gates is Not an Ebola Expert

    Brainwash in the corporate media, including media that the Gates Foundation bribes in exchange for sheer bias, paints the super-rich as the solution rather than the problem



  3. US Government Finally Probes Microsoft Over Financial Fraud, Microsoft Then Bullies the Government With a Lawsuit

    Microsoft is finally being investigated -- perhaps properly too -- for its well-known tax abuses that have so far proved that Microsoft is "too big to jail"; Microsoft is suing the investigator, exerting its abusive power to discourage further investigation



  4. Gagging Critics: Micro Focus-Run SUSE Bribes Journalists in Exchange for Positive Coverage

    Amid the takeover by Micro Focus, SUSE pays journahayess (especially critics) who in turn become some kind of advertisements feed of Novell



  5. Links 25/11/2014: Tizen News, Jolla Tablet Past Million

    Links for the day



  6. Links 24/11/2014: Linux 3.18-rc6, Qualcomm Eyes GNU/Linux Servers

    Links for the day



  7. Boycotting Micro Focus International

    Microsoft's "Partner of the Year" is taking over the patron of SUSE and all of Novell's remains, except the patents (Microsoft has already grabbed those)



  8. Vesna Stilin's Remarks on Željko Topić: Part XI

    Vesna Stilin speaks about her confrontation with EPO Vice-President Željko Topić, who has criminal lawsuits against him in Croatia



  9. Links 22/11/2014: Linux Mint 17.1, Ubuntu MATE

    Links for the day



  10. Links 21/11/2014: Problems at Debian, Jolla Tablet

    Links for the day



  11. Links 18/11/2014: Linux 3.18 RC 5, New DigiKam

    Links for the day



  12. Special Report: Many Criminal Charges Against EPO Vice-President Željko Topić

    The abuses of Željko Topić, who has gained notoriety in his home country, are rapidly becoming public knowledge across all of Europe



  13. Links 16/11/2014: Xfdesktop 4.10.3, GNU Hello 2.10

    Links for the day



  14. Microsoft is Going Into the Anti-Whistleblowing Business, Dodges Criticism Over 19-Year Bug Door in Windows

    With Aorato acquisition Microsoft helps protect the criminals (from whistleblowers) and with lies about .NET Microsoft distracts from a bug that has facilitated remote access into Windows (by those in the know) for nearly two decades



  15. Reaffirming Microsoft's Long-Known Hostility Towards Net Neutrality, Microsoft Crashed Juniper

    Steve Ballmer is ranting against net neutrality and Juniper's business is in trouble after a lot of executives from Microsoft took over most top positions there



  16. Another Massive Step Towards Elimination of Software Patents as Even CAFC Rules Against Them

    After SCOTUS gets involved in the Ultramercial case, the CAFC finally decides to actually serve justice rather than dogma



  17. The GOP's Patent Reform Plan Not Effective Enough to Stop Massive Patent Trolls Like Microsoft/Nokia

    The corporations-serving GOP says that it wants a patent reform, but another reminder is needed of the futility of the suggested changes



  18. How the EPO's Executive Branch (Battistelli and Topić) Banned Scrutiny and Created Authoritarian Model of Control: Part X

    A look at highly dubious moves by EPO President Battistelli and his right-hand man Topić, whose abuses are becoming hard to oversee or even report



  19. Links 15/11/2014: Linux Mint 17.1 Release Candidate, Popcorn Time 0.3.5

    Links for the day



  20. IRC Proceedings: October 26th, 2014 – November 8th, 2014

    Many IRC logs



  21. The Terrible Joke Which is Microsoft 'Loving' Linux: Nightmares With UEFI 'Secure' Boot (i.e. Windows Monopoly Imposed) Continue to Affect GNU/Linux Users

    A reminder of Microsoft's sheer hostility towards GNU/Linux and long-reaching sabotage of GNU/Linux installations



  22. Patent Lawyers Worry About Section 101 in 'Alice' (and Other Patent News)

    A quick roundup of news of interest regarding software patents



  23. Will Write for FUD (Against FOSS)

    Black Duck rears its ugly head again, serving to show that it is in the business of changing perceptions and not in the information or analysis business



  24. Debunking Several Days of Never-Ending Lies About Microsoft and .NET

    .NET is not "Open Source", it cannot be forked (there remains patent threat), Visual Studio is still completely proprietary and it is expected to come to other platforms only because Windows has lost its dominance and Microsoft wants to perpetually control APIs (with software patents) and hence reign over developers



  25. Links 14/11/2014: LibreOffice 4.3.4, Ads Now in Firefox

    Links for the day



  26. Links 14/11/2014: GNOME 3.14.2, PulseAudio 6.0

    Links for the day



  27. Microsoft Windows is Still Designed as a Paradise of Back Doors, Intrusion, Wiretaps, and Interception

    At many levels -- from communication to storage and encryption -- Windows is designed for the very opposite of security



  28. Forget the FUD About Bash and OpenSSL, Microsoft Windows Blamed for Massive Credit Cards Heist

    Home Depot learns its lesson from a Microsoft Windows disaster, but it stays with proprietary software rather than move to software that is actively audited by many people and is inherently better maintained (Free/libre software)



  29. Windows 'Update' and NSA Back Doors, Including a 19-Year Bug Door in Microsoft Windows

    The back doors-enabled Microsoft Windows is being revealed and portrayed as the Swiss cheese that it really is after massive holes are discovered (mostly to be buried by a .NET propaganda blitz)



  30. Revealed: Microsoft is Trying to Corrupt the UK in Order to Eliminate Its OpenDocument Format-Oriented Standards Policy

    Microsoft interference with Britain's preference for ODF is now confirmed, thanks to a valuable news report from Computer Weekly; OOXML lock-in is being unleashed by Microsoft on Android users


CoPilotCo

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

CoPilotCo

Recent Posts