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To: 2MAR$ who wrote (111)	7/20/2000 8:17:44 PM
From: 2MAR$	Read Replies (1) \| Respond to of 762

7/20 Inktomi Stays In The Black During Third Quarter B: Inktomi Stays In The Black During Third Quarter Jul 20, 2000 (Tech Web - CMP via COMTEX) -- Inktomi on Thursday posted its second straight profitable quarter and its first quarter of positive operating revenue. Doing so, it handily beat Wall Street expectations. In its fiscal third quarter ended June 30, the Internet search and traffic-services software firm reported revenue of $61.5 million, a 202-percent gain over revenue of $20.3 million a year ago. Net income for the quarter was $4.5 million, or 4 cents per share, compared with a net loss of $7.7 million of a loss of 8 cents per share in the third quarter of the previous year. That blew past Wall Street consensus estimate of 2 cents per share for the quarter, based on data from analysts polled by First Call/Thompson Financial. "This is a stunning quarter by any standard," CEO David Peterschmidt told reporters and analysts on a conference call from the company's Foster City, Calif., headquarters. "The Inktomi team over-exceeded on every count." In one metric, Inktomi's search engine processed more than 4.8 billion queries during the quarter, a 100-percent increase over the prior year. However Peterschmidt said Inktomi (stock: INKT) will stop listing search queries processed per quarter because the company is expanding into multiple products offered to global 2000 companies and the query count is no longer a good indicator for the business. One area Inktomi plans to forge further into is wireless Internet infrastructure, a market that is burgeoning worldwide and will provide great opportunity for the company, Peterschmidt said. "Scale matters, and scale is what we do best," he said. "The more chaotic the Internet becomes, the better Inktomi does." Inktomi saw growth in two key areas of its business: network products and portal services. Sales in its network products business, consisting of Traffic Server and Content Delivery Suite, contributed $43.1 million in revenue, more than three times the amount it generated last year. Portal services, which consists of search and commerce engines, pulled in $16.4 million in revenue, more than twice the amount generated a year ago. Inktomi, founded in February 1996, said it ended the quarter with more than $272 million in the bank. New customers lead the company to higher profits. In the quarter, Inktomi picked up momentum and customers in the network cache marketplace. AT&T (stock: T), COLT Telecom Group (stock: COLT), Genuity (stock: GENU), KPNQwest (stock: KQIP), and Primus Telecommunications Group (stock: PRTL) selected Inktomi's network products for their content distribution projects. Inktomi's Traffic Server network cache and Content Delivery Suite were selected to enterprise customers including Dresder Bank SAP, the U.S. Postal Service, and the European operations of Fidelity Investments and Merrill Lynch. Repeat business from Sun Microsystems (stock: SUNW) and America Online (stock: AOL) also contributed to the quarter's performance, Peterschmidt said. It wasn't all positive news for Inktomi during the quarter. One major customer, Yahoo (stock: YHOO), dropped Inktomi as its default search engine and signed on Google. Inktomi officials pointed out on the conference call that no single customers accounted for more than 10 percent of their revenues. In another significant event in the quarter, Inktomi closed a deal to buy the Ultraseek software division of Go Network (stock: GONT) for a price of about $344.7 million. techweb.com Copyright (C) 2000 CMP Media Inc. -0- * end of story *