CRM Serves Up Grim Quarter - InformationWeek

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Software // Enterprise Applications

CRM Serves Up Grim Quarter

It's a bad sign for a market sector when flat revenue is a highlight. That was the case for customer-relationship management software last week. Siebel Systems Inc.'s quarterly revenue fell 26% from a year ago to $332.8 million, and net income plunged to $4.6 million from $64.6 million. Kana Inc. sales sank 28% to $18.1 million, and E.piphany Inc. was the star with slightly better than flat sales of $22.5 million--but both lost money. PeopleSoft Inc. revenue, including CRM sales, dropped 5% to $460.3 million, and profit fell 13% to $38.5 million. The theme: maintenance and services fees up, license revenue down. The problem, says Rod Johnson of AMR Research, is CRM is considered high risk. Late last year, AMR surveyed customers from vendors' lists and found only 16% could quantify ROI.

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