Siebel slides as PeopleSoft forecasts upturn
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PeopleSoft and Siebel Systems have reported mixed results in their respective fourth quarter and full year 2002 reports.
23 January 2003 PeopleSoft and Siebel Systems have both reported disappointing results in their fourth quarter and full year 2002 reports. But PeopleSoft CEO Craig Conway is forecasting a modest upturn in IT spending in the coming year.
Customer relationship management software specialist Siebel Systems reported revenues down 22% to $1.6 billion (€1.5bn) during 2002. The company also reported a net loss of $35.7 million (€33.2m) compared to net income of $254.6 million (€236.8m) the year before.
In the fourth quarter sales slumped 19% to $394.7 million (€367.1m), compared to $487.8 million (€453.7m) for the same period a year earlier. Behind this decline was a 37% fall in software licence sales to $157.4 million (€146.4m), although services revenues remained flat.
However, Siebel highlighted the fact that the fourth quarter figures were up by 11% compared to the third quarter of 2002.
Siebel's problems are partly due to the cost and complexity of its software. CEO Tom Siebel has even admitted to analysts that the company's software is too complex for the average user. "Siebel customers say they do not need more than 200 CRM [software] modules, 1,500 tables and an interface capable of landing the space shuttle," said Rod Johnson, an analyst at AMR Research.
Meanwhile, enterprise resource planning software vendor PeopleSoft has also reported a decline in revenues. Sales in 2002 fell by 8% to $1.95 billion (€1.81bn) and net income was down marginally, by just under 5% to $182.6 million (€169.8m).
Like Siebel, PeopleSoft's fourth quarter revenues were up sequentially compared to the third quarter. In the three months to the end of December, revenues weighed in at $512.3 million (€476.5m), up from the third quarter's $471.2 million (€438.3m).
Announcing the figures, PeopleSoft CEO Craig Conway said that he was confident of an upturn in 2003. "I consider the market now to have made its way to the calm after the storm [of 2002]." Last year, "all of us could feel the seat belts on our chests as they were slowing down," he told Reuters.
Conway said that most companies had now made the cuts they needed to make and some have already approved and secured funding for projects for the coming year.
