Shares in Persistence Software Inc plunged 45% Monday after the e-commerce software company warned that third-quarter revenue will come in below expectations. The San Mateo, California-based company said that revenue for the quarter is now expected to be in the range of $2.5m to $2.7m, although it declined to say what previous estimates had been. The weak quarter was blamed on an unexplained delay in closing a large contract.
In the wake of the bad news, Persistence shares dropped $11.75 to close at $14.3125. The company, which had been expected to post a loss of $0.13 per share, did not say what its current bottom line expectations were. Persistence said it views the revenue shortfall as an unfortunate timing issue and we are still in negotiations with the potential customer. Full operating results for the third quarter are expected to be reported October 27.
In the second quarter, Persistence reported revenue of $4.2m, up from $2.1m in the year-ago quarter. The second-quarter net loss was $1.3m, or $0.09 per share on a pro forma basis, essentially flat with a year earlier. The share price drop shaved $223.8m off the company’s market capitalization in one trading session.
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