Sybase Reports Best-Ever First Quarter Results

Sybase last week reported financial results for the first quarter ended March 31, 2009. Total revenue for the first quarter of 2009 increased to $267.5 million from $260.1 million in the first quarter of 2008. License revenue grew to $89.3 million compared to $78.1 million in the first quarter of 2008. Services revenue was $135.0 million, and messaging revenue was $43.3 million in the 2009 first quarter.

The company held an earnings conference call to report the results. What Sybase sees in the IT spending environment is "pretty much" what it saw in the fourth quarter of last year, states John Chen, chairman, CEO and president of Sybase. Customers are still spending IT dollars but on a cautious and selective basis and remain focused on cost reduction and quick return on investment.

For the quarter, Sybase's enterprise database license revenue which includes ASE, IQ and RAP, grew 31% year over year, reflecting continuous market share gain, notes Chen. Some key customers adopted the ASE Shared Disk Cluster options and the company expects the technology to be a "future revenue catalyst." Additionally, reflecting success in the analytics market, he adds, IQ and RAP continue to generate double digit growth.

Looking back on key developments in the last quarter, Chen observes that IQ on Sun hardware achieved a new record price/performance benchmark for both the 1TB and 3TB environment, including large scale data warehouse and decision support systems. In the first quarter, Sybase also launched IQ 15, extending leadership in the column-based architecture, as well as a CEP module as an add-on option for its risk analytics platform. The market response to RAP which was launched less than a year ago has been "extremely positive," he adds. Also this quarter SAP selected the Sybase Unwired Platform to extend SAP Business Suite functionality to all major mobile device platforms. "There are currently 40 million licensed users of SAP enterprise systems so the market potential is huge," states Chen. The announcement has already generated a tremendous amount of interest, especially from global system integrators, he adds.

Responding to a question about the potential impact on Sybase of the recently announced Oracle acquisition of Sun Microsystems, Chen states, "I am not going to stick my head in the sand and think this is not going to be a problem." However, he notes, software is "a lot stickier than hardware" and hardware is more "changeable." IQ runs on Sun but it also runs on Linux platforms, Intel, and on the IBM p Series as well as the HP platform, he adds, pointing out that there are choices available.

For full-year 2009, management anticipates total revenue of approximately $1.1 billion, representing approximately 5% growth before taking into account an estimated 8% negative currency impact. For additional details, go here.