Netscape 3rd-Qtr Earnings Rise 53% on Strong Sales
Mountain View, California, Oct. 21 (Bloomberg) - Netscape
Communications Corp. said third-quarter earnings soared 53
percent, slightly more than expected, on strong sales of its
corporate software products.
The Internet software maker's net income rose to $11.7
million, or 13 cents a share, from $7.66 million, or 9 cents,
year earlier. Per-share earnings beat the 12-cent average
estimate from 16 analysts surveyed by IBES International Inc.
Netscape said its two primary products for the corporate market,
Communicator and SuiteSpot, continue to be adopted by major
corporate and institutional customers. The company competes
against Microsoft Corp. and International Business Machines
Corp., which dominate that area. Advertising on its Web site also
boosted Netscape's revenue.
''Revenue was very good,'' said James Preissler, an analyst
at PaineWebber. ''They have a compelling product set. They just
need to have the services and support to back that up.''
Revenue rose 50 percent to $150.1 million from $100.0
million.
Netscape's product revenue rose 28 percent to $107.3 million
from $83.8 million a year ago. Service revenue more than doubled
to $42.7 million from $16.3 million.
''The key thing to look at is what proportion was browser
sales,'' Preissler said. ''And also how much was from
advertising?''
Business Segment Sales
The company said sales from its client software -- the
software for computers attached to a network, which include the
Navigator browser -- accounted for 38 percent of total revenue.
Sales from Netscape's server products, which store information on
a network, was 34 percent of total revenue, while professional
services accounted for 28 percent of the company's total revenue.
The company said it earned more than $27 million from its
Web site, which accounted for almost two-thirds of its services
revenue.
The Mountain View, California-based company said it
increased the number of employees in its services organization to
165 at the end of the third quarter from 103 at the end of 1996.
Netscape's shares rose 9/16 to 39 13/16. The company
disclosed its earnings after the close of U.S. trading.
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