Marimba gains on new CEO, earnings
"Push" software company Marimba sees its depressed shares climb by nearly a third after announcing a new chief executive and previewing stronger-than-expected financial results.
Marimba said it would generate revenue of $12.2 million for the quarter ended June 30 and post a net loss of 9 cents to 11 cents per share, excluding unusual charges. Wall Street analysts had predicted Marimba would lose nearly twice that much, or 18 cents per share, according to First Call.
The company formally announces earnings July 23.
Marimba said it made the preliminary earnings announcement to pre-empt concern that the departure of Chief Executive John Olsen--who replaced founding CEO Kim Polese less than a year ago--signaled trouble at the Mountain View, Calif.-based company.
Replacing Olsen is Rich Wyckoff, 41, who will maintain his current position as Marimba's senior vice president of worldwide marketing. Before joining Marimba in September 2000, Wyckoff was senior vice president of marketing at Zland and a vice president of corporate and product marketing at Cadence Design Systems, where he worked with Olsen.
Wyckoff said the positive earnings news reflected a healthy marketplace for automated, or push, software management tools for businesses. Push technology is designed to send information directly to someone's desktop over the Internet rather than waiting until that person specifically requests it.
"There's a lot of demand for our product out there right now," Wyckoff said in an interview. "Companies are trying to save on their costs, and they see that Marimba can do that for them."
The company also benefited from marketing its products to Fortune 1000 companies, rather than to the dot-coms now struggling for survival, he added.
Polese, now Marimba's chief strategy officer, said Olsen had left Marimba "to pursue other interests" and declined to comment further on his departure. She said she is "thrilled that Rich is stepping up."
Analysts caught by surprise at Marimba's sunny outlook credited the company's sales team for improved execution.
"The numbers are obviously strong," said Nathan Swanson at ThinkEquity Partners, who had estimated a 20-cent loss for the second quarter. "I think they had a better pipeline and they closed a higher percentage of what they had in the pipeline. It was better execution and an ongoing process of restructuring the sales force and the sales process."
Swanson said he has no plans to change his "buy" rating on Marimba, pending further guidance from the company.
Marimba in April replaced its chief technology officer, naming Simon Wynn to replace co-founder Arthur van Hoff. Van Hoff joined a new unit, the Advanced Development Laboratory, working on research and development.
The company has taken some hits in the past several months. In May, shareholders sued Marimba, alleging the company and its underwriters misled investors in the prospectus for its initial public offering. The suit is still pending.
In April, the company cut 20 percent of its work force and discontinued Marimba.net, its managed services division.
Shares of Marimba closed at $2.70 Monday, up 65 cents, or nearly 32 percent. They were still well off their 52-week high of $27.