Sybase warns of lower profits
The business software company issues a profit warning, joining the legions of technology companies who are suffering from slower sales because of the U.S. economic slowdown.
The business software company announced that first-quarter earnings are expected to be 23 to 26 cents a share on revenue of $227 million to $231 million.
For the first quarter, which ended March 31, Wall Street analysts polled by First Call had predicted earnings of 28 cents a share. Merrill Lynch analysts had predicted first-quarter revenue of about $253.2 million.
Sybase chief executive John Chen said the slowdown in North American sales affected the company's entire family of products, including database management software and e-business software.
"People just don't want to buy," Chen said in a conference call with analysts Tuesday. "You've heard the same sad story: The deal is there, but when it's time (for us) to come pick up the order, (the customers) say they can't deal with it. It's that kind of environment."
Executives from rival database software maker Oracle made a similar admission when the company issued an earnings warning in early March. Oracle Chief Executive Larry Ellison blamed his company's shortfall on software sales that fell through in the last few days of the quarter.
Sybase will disclose its first-quarter earnings on April 19. Chen said sales in Europe and Asia remain strong. The company currently has a hiring freeze and is finding ways to reduce costs, such as reducing travel expenses, he said.
Chen added that he expects Sybase's acquisition of business software maker New Era of Networks to finalize in the next few weeks.