The share price of Comverse Inc. (Nasdaq: CNSI) fell 8.5% to $22.83 on Monday, in above average turnover, after publishing a weak financial report for its first fiscal quarter of 2014, which ended in April.
Revenue fell 23.5% to $119.1 million for the first fiscal quarter from $155.8 million for the corresponding fiscal quarter of 2013, and its net loss quintupled to $16.1 million ($0.72 per share) from $3.1 million. The company burned $35.6 million during the quarter, reducing its cash and cash equivalents to $210 million at the end of April.
Revenue in both of Comverse's business units fell. BSS revenue fell 25% to $56.9 million for the first fiscal quarter from $76.3 million for the corresponding quarter, and digital services revenue fell 22% to $62.3 million from $79.6 million. The drop in revenue from BSS, which the company has targeted as a growth engine, is particularly painful.
Our first quarter results are indicative of the ongoing transformation underway at Comverse," said Comverse president and CEO Philippe Tartavull. "While the benefits of our transformation efforts are not yet fully reflected in our financial results, I am pleased with the progress we have made in repositioning Comverse and the strategic direction we have decided to pursue. Our overall approach is focused on decreasing the Total Cost of Ownership as well as providing additional application platforms to improve the efficiency and increase the revenues of our customers while significantly increasing the percentage of our recurring revenue."
Published by Globes [online], Israel business news - www.globes-online.com - on June 10, 2014
© Copyright of Globes Publisher Itonut (1983) Ltd. 2014