For the second quarter, ended June 30, the company reported net income of $2.3 million (15 cents per share), compared with net income of $27.5 million ($2.41 per share) a year ago. This year's bottom line includes onetime charges for debt repayment and a $1.7 million restructuring charge, while last year's totals were increased by several onetime gains.
Revenue for the quarter was $43.6 million, up more than 18% from $36.8 million one year ago. License revenue, a key growth indicator, was up more than 30%, to $19.6 million. "We've had good demand," says Sanju Bansal, MicroStrategy's chief operating officer. The solid results for the quarter "show that our top-line revenues are growing nicely and our costs are under control," he says.
Big deals in the quarter included a $5 million contract with the U.S. Postal Service, which is expanding its MicroStrategy software seats to 30,000. Bansal says a number of new customers, including eBay Inc., are migrating to MicroStrategy from competitors because they need better scalability.
Customers are buying more software because the economy appears to have stabilized, he says, and buying more from MicroStrategy now that the financial problems the company experienced between 1999 and 2001 are behind it.
MicroStrategy is projecting third-quarter revenue of $36 million to $39 million and a loss because of planned charges of $27.9 million for converting outstanding debt into equity. For fiscal 2003, the company expects revenue of $155 million to $165 million and a loss, again because of charges.