SaaS: Omniture and Citrix

Omniture declared their second quarter earnings on July 23. Net loss was $6.5 million or $0.09 per share, compared with $4.1 in the second quarter of 2007. GAAP revenues for the same period were $71.6 million, compared with $63.2 million in the previous quarter and $33.5 million for the same period a year ago. This larger second quarter net loss is mostly due to acquisition-related costs and other expenses.

During the quarter, Omniture added over 250 new customers (similar to last quarter) and now has nearly 4,700 customers worldwide. The rate at which customers left was higher than normal, however.

As I had mentioned in May (also reported by the company in their earnings call), sales for 2008 are projected to be $295 million to $300 million. This is lower than analysts’ consensus forecast of $311.2 million, according to Bloomberg. Net losses are expected to be in the range of $0.47 to $0.42 per share. The results caused the stock to fall over 12% from $20.97 (pre-earnings) to $18.40 at the close last Friday.

Application Delivery Infrastructure leader, Citrix, announced Q2 2008 revenues of $392 million compared with $334 million in the second quarter of 2007, indicating 17% revenue growth.

The outlook for 2008 was slightly reduced, with EPS projected to be around $1.54 to $1.60 per share on revenues of $1.59 billion to $1.62 billion. Earlier forecasts were EPS of $1.59 on revenues of $1.62 billion.

Second quarter earnings fell $0.18 a share to $34.6 million from $53.4 million ($0.29 a share) a year ago. Third quarter estimates are in the range of $0.12 to $0.16 cents a share on revenues of $385 to $440 million. Product license revenues increased 12% while revenue from license updates grew 16%. Technical services revenues grew 34%. Repurchased shares for the quarter were 2.1 million shares at an average of $33.50 per share.

See my previous earnings coverage here. In another post, I discuss the possibility of Citrix being an acquisition target for a company like Oracle. Or more interestingly, how a roll-up of Enterprise 3.0 players like Citrix, Rightnow, Omniture, Taleo and Concur, would build a larger SaaS player and stave off a company like Oracle. The latter would be my preferred choice for the SaaS category. Another way to create bulk in SaaS is for companies like Omniture and Citrix to acquire smaller SaaS players, seven of which are discussed here.

I am also amazed that Microsoft has not made any effort whatsoever to make acquisitions in the SaaS category.

Citrix’s stock has declined over 14% in the last six months and closed at $25.69 on Friday.

This segment is a part in the series : SaaS