Insignia Solutions Plc
Dow Jones Newswires -- February 5, 1999
Insignia Solutions Had $14M In Revenue For 1998
By Maria V. Georgianis
NEW YORK (Dow Jones)--Insignia Solutions PLC (INSGY), best known for software that allows Windows applications to run on Apple computers, hopes to boost earnings and revenue with a product that allows Java software to be used in consumer electronics.
Insignia Solutions, of Fremont, Calif., expects to ship its Jene products, which are based on Sun Microsystems Inc.'s (SUNW) Java software, this quarter. Insignia Solutions Chief Financial Officer Stephen Ambler told Dow Jones revenue from Jene is expected to ramp up through the year.
Ambler said he anticipates total 1999 revenue of $20 million, 75% of which will come from Jene. The balance is expected to come from the company's SoftWindows product, which allows Windows programs to run on Apple and UNIX computers.
Ambler said he expects a "slight loss" in 1999. The company earned $442,000, or three cents a share, in 1998, mostly from the sale of a former product line to Citrix Systems Inc. (CTXS).
Insignia Solutions expects losses in the first and second quarters, breakeven results in the third and profits in the fourth, Ambler said.
No financial analysts follow the company.
Insignia Solutions reported 1998 revenue of $14.1 million, with most of that coming from SoftWindows. It posted 1997 revenue of $38.9 million.
Revenue from SoftWindows and similar types of products has been falling over the years, a situation the company said required a quick change of direction. SoftWindows "is in a long-term decline,"
Ambler said. He cited competition from similar software products and the fact that the price of Windows-based PCs has become so low.
Enter Jene. The company began formulating its product plans in 1996 and this week shipped the second test version of its Jene Runtime software to 10 companies evaluating it.
Jene Runtime allows Java programs to run in embedded-system devices such as cellular phones, set-top boxes, car navigation systems, among other consumer electronics. Embedded systems, in essence, are hidden computers. The functions of a digital alarm clock, for instance, are controlled by embedded-system software.
Insignia Solutions expects revenue from Jene, a product that allows Java software to be used in consumer electronics, to come from three sources: customers who license the software, payments for updates to the software and royalties from products that use the software, Chief Financial Officer Ambler told Dow Jones.
If a customer ships a cellular phone that has embedded software developed with Jene, for example, then Insignia Solutions would receive a royalty. The company's Jene products include software used
to write Java programs for devices with embedded systems.
Based on the positive feedback from a number of potential customers who have reviewed Jene,Ambler said he is comfortable with projecting revenue of $40 million in 2000 and earnings of 85 cents a share.
Insignia Solutions is positioning its Jene software as an alternative to the current programming tools that are used to develop applications for consumer electronics with embedded systems. It is hitching itself to Sun Microsystems' campaign to get Java widely used by software developers.
Jene can be used to develop Java applications that run on a consumer electronics device, as well as others that can be accessed by the device from a server on the Internet, according to Ron Workman, senior vice president of marketing.
Workman said market researchers last year estimated the world-wide market for embedded software to be worth $1 billion. Embedded software written in Java was a minuscule part of that market, Workman said.
- Maria V. Georgianis; 201-938-5244; maria.georgianis@cor.dowjones.com.
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