Feeds

BMC ekes out quarterly growth

Overcomes bookings decline

Protecting users from Firesheep and other Sidejacking attacks with SSL

Systems management software provider BMC Software said it did alright in its most recent quarter and is raising its expectations for the remainder of fiscal 2010.

BMC, which sells tools for managing just about every kind of system known to man and the applications that ride on top of them, was able to squeeze out $450m in sales in the first quarter of fiscal 2010 ended in June, an 2.9 per cent increase over the prior year.

Unlike many other software companies in this economic downturn, BMC was able to grow its software license sales, pushing them up 11.8 per cent to $167m in the quarter. However, maintenance fees declined 1.2 per cent, to $251.2m, and professional services sales fell by 5.9 per cent, to $31.8m.

Net earnings came in at $82.4m, hugely better than the $1.2m BMC had a year ago when it had to write off $50.3m in research and development costs related to its $800m acquisition of server and storage management specialist BladeLogic, and its R&D, sales, and marketing budgets were a lot higher, pushing down profits.

Not everything was rosy at BMC in the quarter, so don't get the wrong idea. Bookings fell by 19 per cent to $390m, which shows that sales are still under pressure. License bookings for its Enterprise Service Management (ESM) tools, which control workloads running on Windows, Unix, and Linux servers, came in at $73m in the first fiscal quarter, down 25 per cent; operating income came in at $43m, nearly triple from a year ago.

The company did not elaborate on its bookings for its Mainframe Service Management (MSM) tools, but said that operating income was up 12 per cent to $105m. Bookings levels were not given for the key Business Service Management (BSM) product line, which is BMC's focus these days as it has moved up the stack from managing systems to managing application server levels in a way that business execs like to think about it.

"While we are not pleased with our bookings results in the first quarter, we see no fundamental change in the health of our markets, end-user demand, our business strategy or our competitive positioning," said Bob Beauchamp, BMC's chairman and chief executive officer, in a conference call with Wall Street analysts. "We continue to see strong interest in our BSM solutions and our win rate against the competition remains high."

BMC ended the quarter with $1.7bn in deferred revenue - yes, that is nearly a whole year of revenue - and $1.3bn in cash and equivalents. So anyone thinking of buying BMC has to add $3bn to the price right off the bat. BMC's stock was off a little more than three per cent as we went to press, and the company has a market capitalization of $6.3bn.

In recent months, BMC has extended its tools to manage virtual machine images on Amazon's EC2 cloud and its tools are used to manage applications running on Cisco Systems' California Unified Computing System converged blade-storage-networking platform. But these efforts have yet to yield any material revenues.

Beauchamp did say Cisco has finally done its first UCS shipments in July - the boxes were expected to be generally available at the end of June - and the BladeLogic tools were included in the initial UCS orders.

Looking ahead, Beauchamp told Wall Street that the company was raising guidance. He now believes both revenues and total bookings for fiscal 2010 - which ends in March 2011 - will be up "in the low single digits". Non-GAAP earnings per share will be between $2.47 and $2.57, an increase of 12 per cent compared to fiscal 2009 at the midpoint of that range, and up 10 cents compared to guidance from earlier this year. ®

Choosing a cloud hosting partner with confidence

More from The Register

next story
Hey, Scots. Microsoft's Bing thinks you'll vote NO to independence
World's top Google-finding website calls it for the UK
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
OECD lashes out at tax avoiding globocorps' location-flipping antics
You hear that, Amazon, Google, Microsoft et al?
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.