Mixed Fortunes For Technology Vendors Despite Recovery

Technology companies are hoping the economy continues to improve but some are doing better than others. The depression in the PC market is having its effect but generally the figures augur well for this quarter.

Following Ingram Micro and Capita reporting double digit growth, Veeam and Centrify enjoyed record results, Riverbed’s results were depressed by its Opnet purchase, and Fujitsu’s figures witnessed the pain being felt by hardware vendors.

Upward trend

Virtualisation technology provider Veeam posted record results for the second quarter of 2013 with total bookings revenue increasing 100 percent in the second quarter compared to the same period in 2012. New licence bookings revenue also grew 96 percent over the same period.

Its Backup & Replication for Microsoft Hyper-V business managed to grow 299 percent in the second quarter of 2013 compared to the same period in 2012.

The firm also announced Insight Venture Partners as a new strategic business partner, and as part of this relationship, Insight acquired a minority share.

It was different news for Riverbed Technology. The firm’s share prices fell 15 percent after it admitted the integration of recent acquisition Opnet had not gone according to plan. Opnet was bought by the company for $1 billion (£660m) last October.

Riverbed posted a second-quarter loss of $16.5 million (£10.9m) as expenses increased, masking revenue growth driven by its Opnet buy. Company revenue increased 26 percent from last year to $250 million, below analysts’ predictions.

In a conference call, Riverbed chief executive Jerry Kennelly said steady progress had been made in integrating the two firms’ back office functions but combining the two sales forces had not moved “as fast as we had hoped”. He added that the integration would require another quarter to sort out.

“We still have work to do integrating the two companies,” said Kennelly.

IT behemoth Fujitsu reported losses of $221 million (£146m) in the company’s first quarter, smaller than originally anticipated by the firm. Its Systems Platform Group, which has a strong presence in the UK and Europe, posted $1.24 billion (£818m) in sales for the quarter.

Its Ubiquitous Solutions group, which sells PCs, smartphones and mobile devices fell eight percent to $2.18 billion (£1.44bn) as the firm blamed a shrinking consumer PC market and falling large-order volumes from customers in the financial services industry.

But identity services vendor Centrify saw the best results in the company’s history with sales growing more than 40 percent compared with last year. While the firm did not divulge exact figures, it did say that it has grown its installed base to a total of more than 5,000 customers. It claimed that this was the largest market share in the industry.

In Europe, the new customer base grew by 45 percent and its partner base expanded by 900 per cent and cited Preventia in the UK as being one of its partners.