Software.com Reports 33 Percent Sequential Revenue Growth for Third Quarter 1999
Company Announces Acquisition of Telarc Inc., Wireless Internet Infrastructure Developer
SANTA BARBARA, Calif.--(BUSINESS WIRE)--Oct. 20, 1999-- Software.com Inc. (Nasdaq: SWCM), a leading developer of carrier-scale, internet infrastructure applications for service providers worldwide, today announced financial results for the third quarter and nine months ended Sept. 30, 1999.
For the third quarter ended Sept. 30, 1999, Software.com reported total revenue of $12.0 million, an increase of 74 percent over revenue of $6.9 million for the same quarter last year. The Company reported a net loss of $1.7 million, or $0.04 on a basic and diluted per share basis, versus a net loss of $1.5 million, or $0.06 per share for the same quarter last year.
For the nine months ended Sept. 30, 1999, Software.com reported total revenue of $29.1 million, an increase of 63 percent over revenue of $17.9 million for the same period last year. The company reported a net loss of $6.6 million, or $0.21 on a basic and diluted per share basis, versus a net loss of $5.4 million, or $0.21 per share for the same period last year.
"Driven by the addition of ten major customers with more than 100,000 licensed seats each," said Software.com Chief Executive Officer, John L. MacFarlane, "we saw our total licensed seats increase by 9 million to over 56 million. This generated sequential revenue growth of 33 percent from our June 1999 quarter, demonstrating the strength of our license business as customers continued to deploy our carrier-scale applications."
Software.com Expands its Wireless Messaging Capability
"As previously announced on August 16, 1999, we licensed our carrier-scale InterMail(R) platform to Sprint PCS for their Sprint PCS 100 percent digital wireless messaging service (which went live on October 4)," MacFarlane continued. "We see tremendous interest at Sprint and other wireless customers for our messaging platform, thus we decided to enhance our position in wireless messaging by today acquiring Telarc Inc., a developer of wireless and telephony internet infrastructure applications, for approximately $15 million in cash and stock.
"Telarc Inc. currently provides carrier-scale Short Messaging Service (SMS) technologies, which we have integrated with our InterMail(R) platform at the Sprint PCS wireless deployment," added MacFarlane. "The Telarc solution strengthens our ability to aggressively market and deploy our wireless messaging solutions to additional global service providers launching wireless data and voice services."
The acquisition of Telarc Inc. will be accounted for as a purchase. The Company expects to record a one-time charge to earnings, related to the write off of purchased in-process research and development, in the range of $3-5 million for the quarter ending Dec. 31, 1999. The company will book goodwill and other intangible assets of approximately $10-12 million for the remainder of the purchase price, to be amortized over three years.
International and Channel Business Success Continues
"We continued our international expansion, particularly in Europe, as many ISPs there went live on our messaging solutions during the third quarter. We also had key international customers extend their licenses, highlighted by Tele Danmark A/S, which continues to build and expand its highly scalable and reliable messaging infrastructure utilizing the InterMail(R) platform," added MacFarlane.
"I'm also pleased with the progress of our channel and territory businesses, as our InterMail(R) Kx product gains traction in the mid-size ISP market. Much of the improvement in our Kx business is the result of early successes by our reseller partners, IBM and Hewlett Packard, as they closed several Kx deals during the quarter," concluded MacFarlane.
About Software.com
Founded in 1993, and with over 56 million seats licensed, Software.com is a leader in carrier-scale, Internet infrastructure applications for service providers. Built on native Internet standards and proven in real-world deployments to be scalable, highly reliable, available and manageable, Software.com's products and services are specifically designed to enable service providers to market Internet based services to businesses and consumers.
Customers comprise many of the largest service providers worldwide, including: Excite@Home, Ameritech Interactive Media Services, AT&T Canada, AT&T WorldNet(R) Service, Bell Atlantic Internet Service, GTE Internetworking Services, Hongkong Telecom, Pacific Internet, PSINet, Sprint PCS, Road Runner, Telecom Italia Net, Telecom Malaysia, Telecom New Zealand and TeleDanmark. Software.com also has established strategic relationships with Cisco Systems, Hewlett-Packard, IBM and Telcordia Technologies (formerly Bellcore), in order to further develop, market, and sell its messaging solutions.
With headquarters in Santa Barbara, the company maintains offices throughout the U.S., Europe and Asia. Software.com can be reached in the U.S. at 805/882-2470 or software.com.
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