The bad news keeps flowing from database software maker Informix Software (IFMX)
The company today reported a net loss much greater than Wall Street anticipated. It also said it will restate its 1996 results due
The company reported revenues of
$164.7 million for the second quarter ended June 29 and reported a loss of
$120.5 million, or 79 cents per share. The company took a $62.1 million
restructuring charge in the quarter.
Wall Street had expected the company to post a loss of 25 cents a share,
according to First Call.
Last year the company reported a profit of $21.6 million, or 14 cents a
share, on revenues of $226.3 million for the quarter. But those figures,
along with the rest of the quarters in 1996, will have to be restated.
The company said it has discovered errors in the recording of revenue
for fiscal 1996. As a result, totals for revenue and net income for the
year will decrease, according to a statement. Informix estimates that
revenues will be adjusted by $70 million to $100 million.
In April, Informix was slapped with a handful of shareholder lawsuits as
the company's financial disclosures came under increased scrutiny. The
suit alleges that the company reported inflated and deceptive earnings
because of improperly recognized revenue. The suit also alleged that
Informix and certain of its officers and directors violated federal
securities laws by misrepresenting the company's earnings growth
Informix reported an unexpected first-quarter loss of $140.1 million, as
revenue plunged 34 percent to $133.7 million.
The company continues its efforts to regroup after a series of blows.
Last week, former CEO Phil White resigned as chairman and left Informix's
board of directors. Bob Finocchio, who replaced White as CEO nine days
before, was elected to the chairman's post.
White has been under fire recently from angry shareholders; some called
for his resignation at the annual meeting in May. Investors blame White
for Informix's sinking fortunes in recent months, as it focused its
marketing and technical efforts on its new object-relational Universal
Server, while scaling back efforts on its bread-and-butter Online
Dynamic Server database.
The company also took on rival Oracle. Informix accused the No. 1
database maker of improperly hiring away 13 former Informix engineers
and alleged they took trade secrets about a forthcoming database product
with them. Informix withdrew the charges in June.
The company is now attempting to consolidate. The workforce, at 4,630 in
the first quarter, was 4,190 at the end of the second quarter.
Informix said it will continue to consolidate throughout the third
quarter, and will lay off an additional 10 to 15 percent of its
workforce, primarily in sales and marketing positions.
An additional restructuring charge will be taken in the third quarter to
cover additional severance costs and asset writedowns, according to the
On a related note, Steve Sommer, former vice president of worldwide
marketing at Informix, has left the company to join Portal Information Networks, a maker
of Internet customer management and billing software.