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Veritas' earnings slip below target

Martin LaMonica CNET News

Published: 06 Jul 2004 14:45 BST

Citing weakness in US sales, Veritas said on Tuesday that its second-quarter earnings will come in lower than anticipated.

The company, which makes storage-management software, announced that preliminary revenue for its second quarter, which ended on 30 June, will be in the range of $475m to $485m (£258m to £263m). Earnings for the period, excluding costs such as amortisation, will be between 18 cents per share and 20 cents per share, the company said.

Analysts surveyed by First Call had expected that earnings per share would be 24 cents per share for the quarter. Revenue was expected to be about $500m.

Veritas' stock price was down 24.6 percent to $20.02 on Tuesday morning, from $26.55 at the end of Friday. The company has scheduled an earnings call for 27 July.

In a statement, Veritas chief executive Gary Bloom said that the earnings shortfall is due to poor sales to corporations in the United States. "At the end of the June quarter, our anticipated order flow weakened, contributing to lower-than-expected licence revenues," Bloom said.

License revenue for the quarter will be between $263m and $273m. Bloom said services revenue remained strong at $212m.