On the GAAP side, NetSuite lost $16.8 million for the quarter just ended, down from $20.4 million in red ink a year ago. Non-GAAP net income was $6.9 million, up 19.8 percent from $5.7 million in last year's corresponding period. Revenue hit $106.9 million, up 34 percent from just under $80 million a year earlier. Spending for R&D was up 42 percent – head count up even more – with marketing 32 percent higher. And the company intends to ramps up from that. Back to Nelson and SAP. It was more like driving heavy equipment across what he perceives as the grave of ByD, which he labeled "the most spectacular failure" in cloud software. Nelson also trashed SAP's Hana in-memory technology, which he said "seems to be a magic database than can do anything. We'll have to see what it can do someday" and dismissed SAP, Microsoft and Sage as the "flip phones" of the software business. The financial news came on top of the announcement that NetSuite is acquiring TribeHR, another cloud company. Nelson said that one the big appeals is the social capabilities which give employees a view into the business. Deal terms have not yet been purchased. NetSuite CFO Ron Gill said TribeHR "is a very early stage company" that will not have a big impact on 2014 revenue. Tribe is aimed at the midmarket.Last modified on Friday, 25 October 2013
NETSUITE TO KEEP SPENDING BIG
"Friends, Romans, countrymen; I come not to bury SAP." Okay, NetSuite CEO Zach Nelson actually said "I am not doing this to dance on the grave of SAP Business ByDesign" in this week's third quarter earnings webcast. But let's get to the numbers. The cloud company continued on its course of double-digit revenue combined with a reduction in the net loss for the third quarter ended September 30 along with an increase in non-GAAP earnings.
Bob Scott has been informing and entertaining the mid-market financial software community with his email newsletters for 10 years. And he has been covering this market through print publications for 18 years, first as technology editor of Accounting Today and then as the Editor of Accounting Technology from 1997 through 2009. He has covered the traditional tax and accounting profession during the same time and continues to address that as executive editor of the Progressive Accountant.