The business-intelligence software vendor reports that revenue surged 25%, to $150.6 million, in its first quarter.

Rick Whiting, Contributor

June 19, 2003

2 Min Read

Business-intelligence software vendor Cognos Inc. reported that revenue, fueled by a growing number of big contracts, surged 25% in its first quarter ended May 31. The company reported revenue of $150.6 million and net income of $12.4 million (14 cents per share), also a 25% year-over-year gain.

During the quarter, Cognos inked nine contracts worth $1 million or more (the number of $1 million contracts generally fluctuates between three and four; the previous high was seven). The company also reported signing 58 contracts for more than $200,000 and 445 contracts for more than $50,000, increases of 38% and 32%, respectively.

Business intelligence is evolving from a departmental to an enterprise application, and companies are increasingly standardizing on a single set of tools. Cognos says its growing average contract size shows that it's winning a greater share of those deployments. "Nine is a big number. That's a lot of big commitments," says Rob Ashe, president and chief operating officer. "There's been a continual move up in the value of deals."

Cognos' product license revenue increased 16%, to $57.8 million, during the quarter, and license revenue for business-intelligence software, the bulk of Cognos' product sales, grew 18%, to $56.7 million.

Cognos estimates that the increasing value of the Canadian dollar over the U.S. dollar cost it 2 cents in earnings during the quarter. (Ottawa-based Cognos reports earnings in U.S. dollars, but many of its expenses are paid in Canadian dollars.) But Ashe says there are no plans to take major cost-cutting steps in response. For the current quarter Cognos expects revenue in the range of $155 million to $159 million and earnings in the range of 15 to 18 cents per share.

During a conference call with analysts, Cognos executives disclosed a few details about Cognos ReportNet, the vendor's new Web-based reporting software, which has not been formally announced. The company is selling the software, particularly targeting Web billing and customer-communications applications, even though its formal debut isn't slated until this fall.

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