"It was a good first quarter toward our first billion-dollar year," says Jim Tolonen, CFO and senior VP of finance and administration.
Most of Business Objects' revenue gain came from a 30% increase in service-related revenue to $133.6 million. Despite more than $15 million in license revenue from sales of the company's new BusinessObjects XI software, license revenue increased just 1% year over year to $115.2 million. Maintenance-related revenue generally grows faster than license revenue during product transition periods, Tolonen says.
During the quarter, the company closed nine contracts with license sales valued at more than $1 million each, up from seven such deals a year ago. CNA Insurance is standardizing on BusinessObjects XI under one such contract, Tolonen says.
The quarter provided the first year-over-year full-quarter comparison of Business Objects' financial results following its $1.2-billion acquisition of Crystal Decisions in December 2003.
For the current quarter ending June 30, Business Objects expects revenue in the range of $250 million to $255 million and earnings of 20 to 22 cents per share. For all of 2005, the company expects revenue of $1.01 billion to $1.035 billion and earnings of 82 to 92 cents per share.