CNET también está disponible en español.

Ir a español

Don't show this again

Tech Industry

Novadigm warns of earnings shortfall

The software maker says it missed internal revenue targets because it failed to close certain sales contracts during the quarter.

    Software maker Novadigm cautioned Monday that its second-quarter earnings will fall short of expectations and that its revenue will be weaker than expected.

    For the second quarter, ended Sept. 30, the Mahwah, N.J.-based company said revenue should be about $12.5 million to $12.7 million, with net income of 1 cent to 3 cents per share.

    Novadigm, which makes software that enables the automatic distribution of upgrades, data or transactions across a corporate network, said it missed internal revenue targets because it failed to close certain sales contracts expected during the quarter.

    The warning comes just days after Novadigm rival Marimba said its third-quarter results will miss analysts' estimates. Marimba shares plunged 49 percent Friday after the software maker said it will post a net loss of 13 cents to 17 cents per share, compared to analysts' profit estimates of 4 cents per share.

    Novadigm recently saw its stock take a beating after it reported a first-quarter loss of $2.5 million and announced the resignation of its president and chief operating officer. The company's shares have fallen nearly 43 percent for the year.

    The company said it has already taken steps to improve its sales execution and strengthen its sales management team. "Despite the shortfall, we continue to see strong market demand and are reporting our highest second-quarter revenue while remaining profitable and cash-flow positive," Novadigm chief executive Albion Fitzgerald said in a statement.

    Hewlett-Packard recently agreed to buy a 5 percent stake in Novadigm as part of a deal to sell its flagship Internet management software. Also as part of the deal, the Novadigm product will be sold with HP?s OpenView network-management products.

    Novadigm plans to report second-quarter results Oct. 25.