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Technology Stocks : Net Perceptions, Inc. (NETP)
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To: rupert1 who wrote (2599)7/30/2000 5:35:27 AM
From: rupert1  Read Replies (2) of 2908
 
smear campaign: You only have to look at my predictions in the Competition to guess how disappointed I was with revenues of $12.40M I predicted $15.30M Apart from the competition, I thought that about 45-50% sequential growth was a given - 50% would have required $14.25M

My expectations were based on a number of factors:

- the previous 3 quarters NETP had done 40-54%
- the CEO had said in 2Q CC that growth would not be affected by seasonal factors and would be constant:
- I predicted 23 new customers, expected 25 - in fact there were 22:
- the 2Q is seasonally strong for software sales, generally:
- other CRM companies were doing 40-80% sequential growth (albeit with the help of new acquisitions):
- there was additional interest on the $100M raised with the SPO which I had calculated as being between $0-75M and $1.5 million (other income was $1.25M):
- the CEO said in 2Q CC that Knowledge Management (a big ticket item) had a number of undisclosed customers i.e.$1M or more - in fact income from KM was about $124,000 and only one new customer:
- the company had seemed to indicate that its full complement of sales people would be made up - in fact it is still 29 short - and that sales staff taken on in 4Q and 1Q would be hitting their stride:
- sales of new products:
- increased sales from Europe and Asia where the CC had said demand was very strong:

Having recorded my disappointment, though, I would add the following:

- 34% sequential growth is still extremely good: the comparison was with last quarter which had 54% sequential:
- all NETP's internal financial indicators improved; costs as a ratio of revenues improved strongly:
- the CC seemed to indicate that the Knowledge Management customers were still undisclosed and still in the pipeline because of the extra time needed to complete pilot studies and get the installations up and running before they declared wins - he said again that demand was very strong:
- the CFO said that although the new ASP products got off to a strong start, the revenues were not fully reflected in 2Q:
- the CFO said that dot-coms had lengthened their buying cycle - revenues had dropped by only 1% and there was no loss of customers - just some belt tightening:
- the CEO said the ASP pipeline was strong:
- without any explanation, international sales did not grow: (Dain said that it was because of the slow ramp-up in Asia):
- the CEO said that e-commerce pipeline was strong and that the company did not see any strenghening competition for its core products and did not see any loss of market share:
- hyper-growth of competitors was gained through expensive acquisitions which did not improve their costs-to-revenues ratio:
- 3Q is usually a slow quarter for software, especially in Europe, so watch out!
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