Sequoia 1Q sales sales surge

Sequoia Software (Nasdaq: SQSW), which went public last week, reported Thursday a first quarter loss of $4.4 million on sales of $4 million.

There were no consensus estimates for the company. Sequoia's underwriters haven't started coverage of the company. Analysts are expected to pick up coverage on June 6, when Sequoia's 25-day quiet period expires.

Sequoia, which makes XML-based software for corporate portals, said sales were up from $1.1 million in the same quarter a year ago. The company's net loss increased from $1.2 million a year ago, but was down from $6.2 million in the fourth quarter.

License revenue, driven primarily by Sequoia's flagship XML Portal Server, represented 74 percent of sales. Gross margin for the first quarter rose to 69.8 percent, up from 46.9 percent a year ago.

Sequoia's Portal Server delivers information to corporate portals, intranets and extranets.

In a recent interview, Richard Faint, co-founder and CEO of Sequoia, the company went public in a turbulent market because its XML Portal Server was at an "inflection point where it needed more resources to grow."

Sequoia's chief also said XML will continue to become accepted in business-to-business e-commerce. Sequoia's primary competition includes privately held companies Plumtree Software and DataChannel, which $45 million in its mezzanine round of funding last month.

Faint said Sequoia doesn't compete with XML star WebMethods (Nasdaq: WEBM), but could face competition from Microsoft (Nasdaq: MSFT) and Oracle (Nasdaq: ORCL) in the future. "Microsoft and Oracle aren't competitors, at least at this point," he said.