Shares of on-demand performance and talent management software provider SuccessFactors, Inc. (SFSF) dropped more than 7% in the after hours Thursday, after the company provided earnings forecast for the first quarter and fiscal 2010 below consensus estimate. However, the company reported a narrower loss for the fourth quarter, boosted by strong margins as well as revenue growth. Non-GAAP earnings per share for the quarter also came in line with analysts' expectations.
Separately, SuccessFactors announced that it has agreed to acquire privately-held Inform Business Impact for about $40.5 million in cash and stock, plus contingent consideration. The combination will provide the first purpose built business analytics and workforce planning solution, while accelerating SuccessFactors market-leading business execution software. The acquisition is expected to close in third quarter of fiscal 2010, subject to customary closing conditions.
In another release, the company also announced the appointment of 12-year Cisco corporate development integration veteran, Judy Blegen as vice president of M&A integration. This will boost SuccessFactors' focus on opportunistically taking advantage of selective merger and acquisitions. Blegen will join the company's corporate development team headed up by Seksom Suriyapa, vice president of Corporate Development, who leads the company's strategic acquisitions and investments.
In a statement, founder and chief executive officer, Lars Dalgaard said, "I'd like to thank our customers, colleagues, partners, investors, and analysts for an outstanding Q4 and 2009. In the worst economic year, SuccessFactors had our best year. With organic year-over-year growth rates accelerating each quarter in 2009 to 34%, market revolutionizing innovation and acquisition, our customers buying more than before..."
The San Mateo, California-based company reported a net loss of $2.66 million or $0.04 per share, narrower than $5.98 million or $0.11 per share in the prior-year quarter. Excluding stock-based compensation expense, non-GAAP net income for the quarter was $0.34 million or $0.01 per share, compared to a net loss of $3.28 million or $0.06 per share in the year-ago quarter.
On average, sixteen analysts polled by Thomson Reuters expected the company to report earnings of $0.01 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter increased 28% to $42.21 million from $33.03 million in the same quarter last year, and topped fourteen Wall Street analysts' consensus estimate of $39.72 million.
Loss from operations for the fourth quarter narrowed to $2.07 million from $5.93 million in the year-ago quarter. Total operating expenses were $34.22 million, up from $28.88 million in the prior-year quarter.
Gross profit for the quarter rose to $32.15 million from $22.96 million in the same quarter last year, with non-GAAP gross margin growing to 77% from last year's 71%.
For fiscal 2009, SuccessFactors reported a net loss of $12.63 million or $0.21 per share, sharply narrower than $64.95 million or $1.21 per share reported a year ago.
Excluding stock-based compensation expense, non-GAAP net income for the year sharply narrowed to $2.22 million or $0.21 per share from $56.35 million or $1.21 per share last year. Analysts expected the company to report a loss of $0.04 per share for fiscal 2009.
Revenues for the full year increased 37% to $153.05 million from $111.91 million in the previous year. The Street was looking for full-year 2009 revenues of $150.50 million.
Looking ahead to the first quarter of fiscal 2010, the company expects non-GAAP results of about breakeven per share, excluding the effects of estimated stock-based compensation expense, while analysts estimate earnings of $0.02 per share.
Further, revenues for the first quarter are projected in a range of about $43.0 million to $43.5 million. Analysts are looking for revenues of $41.52 million for the first quarter.
For fiscal 2010, the company expects non-GAAP results of about breakeven per share, excluding the effects of estimated stock-based compensation expense. Revenues for the full year are estimated between $178 million and $180 million. Street analysts anticipate earnings of $0.11 per share on revenues of $176.79 million for the year.
SFSF closed Thursday's regular trading session at $15.61, down $0.88 or 5.34% on a volume of 1.35 million shares, higher than the three-month average volume of 0.57 million shares. In the after hours, the company's shares further lost $1.20 or 7.69% to $14.41.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.