Shares of Parametric Technology (Nasdaq: PMTC plunged Monday afternoon after the company warned of its third earnings shortfall in four quarters.
The software vendor said it would report second quarter revenue and earnings short of the consensus analyst estimate. Parametric's stock price dropped 44 percent in the final 70 minutes of regular trading to close at 10 3/4, down 10 5/16 for the session.
Parametric, which makes software for computer-aided design and supply chain procurement, said it expects to report revenue about 15 percent below the published consensus forecast of $268 million. The company sees break-even results or a slight loss on a per-share basis, compared to analyst estimates of a profit of 9 cents per share, including amortization.
Monday's announcement marks the latest in a series of financial disappointments for Parametric. The company issued a profit warning in the first quarter and missed estimates in the third quarter of fiscal 1999.
Previous earnings letdowns were blamed on slow growth in the company's Pro/Engineer CAD products. This time Parametric faulted both sides of its business, including the Windchill software for buying items used in product development.
CAD software sales fell short of expectations even as Windchill generated revenue of $40 million, or about 27 percent below the company's target of $55 million. Parametric failed to close on some large contracts before the quarter ended, said C. Richard Harrison, president and CEO.
"We continue to find that transitioning our sales efforts to a solutions-oriented, multi-product business model is extremely challenging," Harrison said. "Balancing our sales capacity between Pro/ENGINEER and Windchill -- sustaining the traditional core of our business while building up an exciting new product area -- has created a situation where predicting the quarter-to-quarter license business has become difficult."
Parametric will report final second quarter results on April 18 before the market open.
The company's competitors include Autodesk (Nasdaq: ADSK) and Structural Dynamics Research (Nasdaq: SDRC).