Business intelligence software provider MicroStrategy Inc. (MSTR) on Thursday reported a 23% increase in profit for the second quarter from last year, helped by a lower provision for income taxes, and despite a decline in revenue. The company said it had a lower effective tax rate on income from continuing operations for the latest quarter as compared to the year-ago period.
The McLean, Virginia-based company reported net income for the second quarter of $9.97 million, or $0.81 per share, up from $8.13 million, or $0.66 per share, in the year-ago quarter.
Income from continuing operations for the quarter rose to $9.95 million, or $0.81 per share, from $7.90 million, or $0.64 per share, in the year-ago period. On average, five analysts polled by Thomson Reuters expected the company to report earnings of $0.62 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter decreased to $87.76 million from $88.86 million in the prior-year quarter, but topped analysts' consensus revenue estimate for the quarter of $83.98 million.
Segment wise, Product licenses revenue for the quarter declined to $20.48 million from $21.05 million in the year-ago period. Product support and other services revenue for MicroStrategy's core business intelligence business were $67.28 million, down slightly from $67.80 million in the same quarter last year.
Gross profit for the quarter declined to $71.82 million from $72.75 million in the previous-year quarter.
Operating expenses for the quarter were $55.33 million, down from $57.69 million in the year-ago quarter. Other expenses rose to $1.74 million from $0.10 million a year ago.
The company's provision for income taxes for the latest quarter was $5.06 million compared to $7.72 million in the previous-year quarter.
MicroStrategy's effective tax rate on income from continuing operations for the quarter was 34% compared to 49% for the year-ago period. The higher effective tax rate in the prior-year period was primarily the result of an adjustment that was made to the company's deferred tax asset for state net operating losses and, to a lesser extent, net losses in certain foreign subsidiaries for which the company was not able to recognize a tax benefit for financial reporting purposes in the year-ago quarter.
For the first six months of fiscal year 2009, the company's net income rose to $32.94 million, or $2.69 per share, from $16.42 million, or $1.33 per share, in the same period last year.
Income from continuing operations for the six-month period was $18.61 million, or $1.52 per share, up from $16.86 million, or $1.36 per share, in the prior-year period.
The company recorded a gain on sale from discontinued operations for the half year of $14.44 million.
Total revenues for the half year declined to $168 million from $174.76 million in the year-ago period.
As of June 30, 2009, MicroStrategy had cash and cash equivalents of approximately $176.2 million, compared to $119.60 million a year ago.
MSTR closed Thursday's regular trading session at $58.61, up $0.08 or 0.14% on a volume of 0.13 million shares.
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