Novell falls short in Q3
Novell has fallen short of expectations in the third quarter, blaming drops in revenue and income on reduced customer confidence.
Novell did not meet expectations in its fiscal third quarter, with net income falling from $16.7 million (10.8 million) in the same period in 2009 to $15.7 million.
Net revenue dropped to $199 million from $216 million (139.3 million) as Novell put the results down to reduced customer confidence in the business software company's future.
Back in March, Novell rejected an acquisition proposal from Elliott Associates for around $1.8 billion, claiming the bid was "inadequate."
The firm subsequently announced its board of directors was exploring ways to improve stockholder value, including considering a sale of the company.
Before revising its estimates earlier this month, Novell had hoped to achieve revenue of between $205 and $210 million in the third quarter.
"Our third quarter revenue was below our initial expectations, which we believe is principally related to customer uncertainty associated with the Novell board of directors' ongoing review of various alternatives to enhance stockholder value," said Ron Hovsepian, president and chief executive (CEO) of Novell.
"However, I am pleased that we achieved consistent profitability levels. The growth prospects of our target markets remain strong and our focus going forward is on returning to top line growth via execution of our differentiated strategy, WorkloadIQ."
Novell launched its WorkloadIQ strategy earlier this month, which will focus on the intelligent workload management market.
The approach will be based on the firm's "ability to integrate identity and security into IT workloads thereby giving customers the confidence and flexibility needed to deliver IT services to end users across physical, virtual and cloud environments," Novell said.
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