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AvantGo reports smaller-than-expected loss

The company, which sells software for handheld devices, says it plans to reach profitability two quarters ahead of schedule.

2 min read
AvantGo, which sells software for handheld devices, reported a narrower-than-expected loss Wednesday.

Excluding noncash charges, the San Mateo, Calif-based company reported a net loss of $10.6 million, or 35 cents per share, in the fourth quarter. That compares with a loss of $2.9 million, or 18 cents per share, in the same period a year earlier.

Analysts polled by First Call predicted the company would lose 42 cents per share.

Revenue rose to $6.6 million in the fourth quarter, a 526 percent increase from the $1 million in revenue during the fourth quarter of 1999 and a 42 percent increase from previous quarter.

The company also offered guidance for the year, predicting 100 percent revenue growth in 2001. David Cooper, the company's chief financial officer, said AvantGo expects to reach profitability two quarters earlier than planned--without any additional funding. The company now plans on reaching profitability in the second quarter of 2003.

Analysts said the numbers look strong.

"They did numbers somewhere ahead of our (second quarter) numbers for this year, and they've raised guidance, so it looks pretty impressive," said Mark Fernandes, an analyst with Merrill Lynch.

In the fourth quarter, AvantGo took several steps to bolster its corporate software business. It debuted AvantGo Enterprise for Microsoft Exchange and formed several business partnerships.

Last week, AvantGo announced a partnership with the application service provider Brightpod, to make its products available to midsized businesses more inclined toward a subscription service.

Earlier Tuesday, AvantGo announced a partnership with Research In Motion, which makes the BlackBerry two-way e-mail pager. The companies said they will deliver wireless Web-based data and corporate applications to Fortune 1000 customers, as well as jointly market products to business customers.

AvantGo reported that its consumer software, dubbed AvantGo mobile Internet, has more than 2 million registered consumers.

Since its initial public offering in September, shares of AvantGo have fallen 53 percent, from $20 to $9.37. Shares rose 88 cents, or 9 percent, to $10.25 in after-hours trading Tuesday.