Siebel says purchase delays hurt quarter
The world's economic and political uncertainties caused companies to postpone buying decisions, the software maker said as it issued a financial warning.
The San Mateo, Calif., software maker said Friday that it expects to earn 1 cent per share on revenue of $330 million to $335 million in the quarter ended March 31. Analysts polled by First Call had estimated Siebel would earn 4 cents a share, on average, on revenue of about $369 million. In the same quarter last year, Siebel posted earnings of 12 cents per share on revenue of $477.8 million.
Siebel's warning follows a week of bad financial news from the business software sector. PeopleSoft, Sybase and WebMethods, among others each said sales and earnings for the quarter ended March 31 would miss Wall Street estimates.
Speaking via teleconference, Siebel Chief Executive Tom Siebel compared the war in Iraq with the Sept. 11, 2001, terrorist attacks in terms of its impact on corporate buying decisions.
"As the quarter progressed, global economic and geopolitical conditions seemed to become even more challenging," Siebel said. "By mid-February, it felt in some ways like the Sept. 2001 quarter."
But when asked by a Goldman Sachs analyst whether he expected business to improve after the war, Siebel replied it was hard to say. He also called the economy the company's "biggest competitor."
"It's possible that it is something other than war jitters," Siebel said.
Siebel's first-quarter license revenue, a key indicator of future growth, fell by more than 50 percent to about $112 million from $246 million the year-ago quarter. Company executives said average deal size had declined and that several deals were postponed in the final days of the quarter.
Siebel is scheduled to post full first-quarter results on April 23.