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To: Sarmad Y. Hermiz who wrote (124979)	5/13/2001 7:59:00 PM
From: H James Morris	Read Replies (1) \| Respond to of 164684

>NEW YORK, May 8 (Reuters) - As the flagging U.S economy continues to wreak havoc in the business-to-business software sector, analysts on Wednesday will look to one of the key players, i2 Technologies Inc <ITWO.O>, for some good news. "This whole B2B thing is in so much flux today, we want to find out where i2 sees itself heading and what it's going to focus its efforts on," said Mark Verbeck, an analyst with Epoch Partners. According to spokesperson Jennifer Tejada, i2 is planning to use its annual eDay conference, which kicks off Wednesday in New York, to do just that. "The focus of day one will be the keynote from Greg," said Tejada, referring to the company's newly appointed Chief Executive Greg Brady, who was promoted to CEO from president last week and replaces outgoing CEO Sanjiv Sidhu. "We're going to focus on i2's ability to deliver software that helps customers save money by collaborating with their partners," Tejada said, adding that i2 will name Procter & Gamble <PG.N> as a new addition to that customer list, which also includes giants such as Wal-Mart Stores Inc. <WMT.N>, Barnes & Noble Inc. <BKS.N> and Panasonic, a unit of Matsushita Electric Industrial Co Ltd. <6752.T>. NAIL BITING I2 -- one of the biggest players in the so-called B2B software sector -- is at a critical point in its history right now. Last month, the one-time Wall Street darling posted earnings that were well below analysts' original expectations and cut ten percent of its workforce, as pressure from the slowing U.S economy and a decrease in information technology spending continued to take their toll. Since i2's shares began their dive in March 2000, the company's stock has lost 83 percent of its value and has underperformed its peers comprising the Standard & Poor's software index by 65 percent. And all i2's rivals, including Commerce One Inc. <CMRC.O> and Ariba Inc. <ARBA.O>, have suffered the same fate. But analysts planning to attend the two-day conference said they weren't as pessimistic about i2 going into the second quarter as they were going into the first. "We were walking into the first quarter chewing our nails," said Brent Thill, an analyst with Credit Suisse First Boston. "But I don't think we're in a nail biting situation here." When i2 announced its first quarter earnings, the company also reduced its outlook for second quarter and full year 2001 revenues. "I think the miles have been reset so the numbers are achievable now," Thill said. For the second quarter, i2 said it expects to post revenues of between $275 million to $300 million. Analysts, who have since revised their estimates, on average expect the company to record revenues of $318.83 million, according to Thomson Financial/First Call. Epoch Partner's Verbeck said that of all the B2B players, i2 was most likely to survive and thrive, largely because it hadn't hyped up the B2B concept as much as rivals Commerce One and Ariba, and so it has a better chance of turning itself round faster and gaining credibility. "I think the carnage of this environment benefits i2 more than anyone," Verbeck said. "Their competitors, like Commerce One and Ariba, had more momentum behind them and now some of that momentum's fallen, i2 can take advantage of that." UPSTAGING ERP I2 will also use its analyst conference to highlight new order management software, which lets companies give customers accurate product costs and delivery dates by having instant visibility to all their suppliers' product inventory details. The software is i2's way of trying to upstage enterprise resource planning (ERP) software companies, such as SAP AG <SAPG-p.DE> and Oracle Corp. <ORCL.O>, who have traditionally held the lion share of the order management market. "It's the smallest product line but has the biggest revenue earning potential," said Thill, who added that i2's product was more sophisticated than traditional ERP firms because it enabled customers to see across multiple supplier inventory systems, as opposed to just one. Richard Williams, an analyst with Jeffries & Company agreed: "i2 is using order management as a means to potentially do an end run around ERP companies," Williams said. "This may be its bid to move the fight to a different venue." "Just as Ariba is strategically dead in the water, this could prove that i2 is still in the game," Williams added. 20:31 05-08-01