The Sage Group PLC, corporate parent of Sage North America, yesterday reported that earnings for the nine months ending June 30, 2009 will be in line with their management expectations.
Citing challenging market conditions, Sage UK points to solid growth in subscription revenues.
According to Paul Walker, Chief Executive:
There has been no significant change in market conditions during the quarter ended 30 June 2009 and we are planning for markets to remain testing. However, our proven business model and large, geographically diverse, customer base give us confidence that we are well positioned for these conditions and the eventual market recovery. We expect to report results for the year ended 30 September 2009 in-line with market expectations
Microsoft Reporting 29% Profit Slide
On July 23 Sage’s chief US competition, Microsoft, reported a 29% profit drop and their first ever sales decline since going public.
Sales declined in all of Microsoft’s main business units. Windows software revenue dropped 29 percent after the PC market contracted for three straight quarters. Some customers are holding off purchases until a new version of Windows comes out in October. Demand for Office software and advertising on Microsoft’s Web sites also waned.
“It’s a real disappointment,” said Brendan Barnicle, an analyst at Pacific Crest Securities in Portland, Oregon. He has an “outperform” rating on the shares. “It’s a significant miss” in revenue.