The company's better-than-expected performance comes as the industry continues to experience constrained information technology spending and spotty improvement in some tech sectors. But John Chen, Sybase's chief executive, said he remains optimistic that the second half of the year will pick up.
"We finished the quarter on the high end of what we were expecting. We see business conditions improving?.and wireless and data warehousing are encouraging," Chen said.
Net income was $14.6 million, or 15 cents per share, for the period ended June 30, falling 28 percent from $20.2 million for the same period in 2002.
Net income reported on a pro forma basis was $23.2 million, or 24 cents a share. This beat analyst consensus estimates of 21 cents a share, according to First Call. Sybase's pro forma figure excludes amortization of purchased intangibles, stock-based compensation and restructuring charges and reversals, according to Sybase.
Sybase reported revenues of $192 million, compared with $205 million in the same quarter last year. Analysts were expecting the company to generate $186.3 million, according to First Call.
The company's license revenues fell to $63.9 million in the quarter, down from $77.5 million a year ago. Enterprise licenses, which contribute the largest portion within the category, dropped 10 percent, to $35.5 million in the quarter. But the decline in enterprise licenses was tempered by growth in Sybase's database and replication server product lines, which grew 6 and 20 percent, respectively, in the quarter.
Sybase's services business, however, posted a slight gain in the second quarter to $128.1 million, up from $127.8 million a year ago. Within the services business, Sybase's wireless business increased to $22.7 million in the quarter--up 15 percent over last year.
But Chen noted that the company's integration business remains weak.
"That is also unfortunately true for the industry," he said.
Chen also said the Dublin, Calif.-based company's investment in wireless initiatives, including, is paying off.
Sybase iAnywhere Solutions subsidiary. The iAnywhere is used to build business applications that run on wireless devices.in December for about $38 million. Sybase also has a strong position in the mobile database market with its
An IDC report that was published this week found thatfor the lead in the market for so-called mobile middleware.
Once a database and tools powerhouse, Sybase has diversified its business, notably into wireless software and middleware, or server-based software that connects disparate systems. The company sells its namesakeChen reiterated Sybase's earnings forecast for the year: 95 cents to $1.05 a share. Analysts currently estimate that Sybase will generate 93 cents a share for the year, according to First Call. and associated business intelligence tools as well as development tools, a Java application server, a corporate portal server and wireless-related software.
Chen also said the company's third quarter earnings and revenue performance is currently in line with Wall Street's estimates.
Shares of Sybase were up 53 cents a share, or about 3.63 percent, to $15.13 in late morning trading.