Despite budgetary pressures, IT departments are still striving to ensure that multiple content sources within their organisations are both tightly managed and accessible. Reflecting this, a number of companies in the content management software market showed promising revenue growth in their latest quarters.
Market veteran Documentum, for one, reported a healthy rise in revenue of 12% for its first financial quarter of 2002 to $50.6 million, from $45.3 million in the same quarter in 2001. The company also managed to narrow its losses, reducing its net deficit from $14.7 million in the first quarter of 2001 to $1.7 million in the first quarter of 2002. Chief financial officer Bob Corey attributed Documentum's bolstered revenues to strong renewal figures from existing customers, who are looking to extend their use of Documentum's products across further departments or business units.
A vigorous focus on specific vertical markets led to an impressive 36% jump in first-quarter revenue at fellow content management software supplier iManage. Revenues increased from $8.7 million in the opening three months of 2001 to $11.3 million in this latest quarter of 2002. According to CEO Mahmood Panjwani, iManage signed up 61 new customers in its targeted industry segments: financial services, government, and its core market, legal services.
Not all content management vendors shared such impressive performances, however. Revenues at FileNet, for example, remained almost static, growing by just 2% to $86.2 million in its first quarter of 2002, from $84.5 million in the corresponding quarter of 2001. Unlike some of its competitors, however, FileNet managed to hoist itself back into profit, recording a net income of $1.9 million, compared with a loss of $5.6 million in the first quarter of 2001. The company hopes its recent acquisition of web content management vendor eGrail will extend its appeal in organisations looking to build workflow and collaboration capabilities into static document management systems.
Worst hit by the downturn in spending among the content management vendors was Interwoven, where sales for its first quarter halved. Revenue tumbled 46% to $32.7 million, from $60.5 million in the year-ago quarter. More worryingly, licence revenue – typically considered a reliable barometer of software companies' growth – plummeted 61% to $14.9 million from $39 million in the first quarter of 2001.
Meanwhile, Hummingbird, which has a portfolio that stretches from PC-to-host connectivity to business intelligence tools, has repositioned to focus more on content, knowledge and collaboration management. Leveraging the company's 1999 purchase of document management company PC DOCS, its executives claim sales of records management products have been good, as many organisations need to protect their knowledge base against political, legal and regulatory risks. However, second quarter revenues overall slid 9% to $46.1 million.