Novell's Earnings Fell In Quarter But Beat Wall Street Forecast
February 24, 1998 6:13 PM
NEW YORK -(Dow Jones)- Networking-software
maker Novell Inc. late Tuesday reported
better-than-expected earnings for its fiscal first quarter
amid ongoing restructuring efforts, though the results still
were sharply lower than a year ago.
Orem, Utah-based Novell also reported revenue for the
quarter skidded 33% to $252 million. Revenue also was
down from the fourth quarter's $269.3 million, primarily
because of weakness in the financially strapped Asia
Pacific region, Novell said.
The company said net income for the first quarter fell
72% to $14.1 million, or four cents a share, from $50.8
million, or 15 cents a share, a year ago.
Eight analysts surveyed by First Call had a mean
earnings estimate for the latest quarter of two cents a
share. Novell said earnings were higher than expected
because it was able to lower its costs and expenses
through tighter controls and new management practices.
First-quarter operating expenses totaled $192 million,
down $20 million from the fourth quarter and $45 million
lower than the year-earlier period.
The results were released after the stock market closed
Tuesday. Nasdaq-listed shares of Novell (NOVL) rose
15.6 cents to close at $8.719.
Novell has long been the largest supplier of operating
systems used to manage networks of personal
computers. But rival Microsoft Corp. has mounted a
long-term attack in the networking market with its
Windows NT product.
Novell recently has concentrated on rebuilding its
products around the standard protocol of the Internet
and has said it plans to be a "pure" Internet software firm
by summer 1998.
In January the company met its schedule for launching a
broad public beta test of its NetWare 5 network-server
platform. The final NetWare 5 product, based on open
Internet standards, is expected to ship in mid-1998.
During the latest quarter, Novell said it shipped several
new products that are part of the next generation of
Internet-related solutions, including: Year 2000 solutions
for its core NetWare software, server software for
NetWare made in a joint venture with Netscape
Communications Corp. and directory-service software
for users of Windows NT.
Novell was dealt an apparent setback last month when it
was reported that Microsoft (MSFT) planned to halt
some technical-support services for NT users running
Novell's directory product. The directory software,
which helps manage corporate networks, is seen as a
key to Novell's turnaround efforts. Novell's directory
product can track network users running on different
operating systems like Unix, NetWare, those designed
for mainframes and Windows NT. Microsoft is working
on providing such directory services for Windows NT
only.
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