By William Fellows
We have now become an e-commerce company, BEA Systems Inc chairman and CEO Bill Coleman declared after BEA reported better than expected second-quarter earnings and said that more than 50% of its license revenue is now derived from sales of e-commerce software. BEA reported a second-quarter net loss of $2.06m including charges for WebLogic and Leader Group down from a loss of $40.25m last time which also included charges, on revenue which increased 53% to $103.2m over $67.57m. Excluding charges the company would have recorded earnings of $0.07, a penny better than the average of analysts’ estimates.
Coleman was referring to the gradual shift away from sales of its software for use in traditional OLTP environments to companies using them for e-commerce. He said that BEA’s model is now going according to the business plan and that he is confident about the short-term outlook, while the long-term is looking better as it benefits from the drop off in Y2K spending.
Coleman said that BEA is clearly the leader in bringing Enterprise Java Beans technology to the enterprise and that while its Tuxedo software remains the leading transactional e-commerce platform, the future is clearly WebLogic Enterprise which combines Tuxedo and the web application server. Sales of both products grew by the same amount as last time; WebLogic license revenue grew by 35%. BEA says it has 200 ISVs writing programs for WebLogic, 50 more than last time. It says a slew of existing ISVs are moving towards its e-commerce software, including banking specialist Swift, which is evaluating going over to WebLogic.
BEA says it plans to increase its services revenue to 40% of total sales going forwards, up from 35% now. It says that at its IPO it had planned to do 35% of revenue on services when it was up to $500m sales, moving to 40% once on the path to $1bn revenue. At the six-month mark the net loss was $6m including charges, up from $41.4m which also included charges on revenue which increased 50% to $188.8m from $126.1m.
