Tibco Software Shares Fall As Profits Get Chopped in Half in Q1

Andrew Klips  |

Shares of Tibco Software Inc. (TIBX) are falling in extend trading Thursday after the company reported financial results from the first quarter showing that higher expenses cut net income by 50 percent compared to the same quarter last year, although adjusted earnings were in line with analyst predictions.

Palo Alto, California-based provider of infrastructure software for cloud computing said that revenue for the first quarter of fiscal 2013 was $237.8 million, up from $225.7 million in the year prior quarter. Net income was $9.5 million, or 6 cents per share, down from $20.6 million, or 12 cents per share, in Q1 fiscal 2012. Excluding certain one-time expenses, net income was $31.1 million, or 18 cents per share, compared to $34.6 million, or 20 cents per share, in the year prior quarter.

Wall Street analysts were expecting Tibco to report adjusted income of 18 cents per share on revenue of $242.3 million.

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Vivek Ranadivé, chairman and chief executive officer at Tibco, commented that he believes the company is making the right moves to steady performance to capitalize on trends driving Information Technology spending. "We remain very focused on continuing the changes we initiated last year to improve our execution," said the Tibco chief in a prepared statement.

During the quarter, licensing revenue slipped to $78.26 million from $82.32 million in the 2012 quarter. Service and maintenance revenue increased to $159.53 million, compared to $143.39 million a year earlier.

Total operating expenses rose from $135.46 million last year to $145.3 million in the most recent quarter as the company spent more money on sales and marketing as well as research and development to account for most of the higher operational costs.

No guidance for the current quarter or year was provided in the corporate release, but is anticipated during a conference call Thursday after the bell. Analysts are expecting the company to provide outlook of $265 million in revenue and EPS of 26 cents.

Shares of TIBX closed trading on Thursday at $23.17, down 0.56 percent. Following the news release, however, shares plunged more than 15 percent to under $20 per share. The losses after the bell are adding to a share depreciation of about 25 percent in the past 52 weeks.

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