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NETSUITE REVS UP 30 PERCENT Featured

netsuiteThe results for NetSuite's second quarter ended June 30 would normally be something to crow about. But given the day's announcement that the mother ship is calling NetSuite home—Oracle is buying NetSuite—it seems the rooster has left the building. And the cloud-based software company cancelled this week's second-quarter earnings call. But there was progress on all fronts.

The GAAP loss of $37.7 million was 16.7 percent higher than the $32.3 million in last year's second quarter. But the revenue line grew much faster so the negative net margin improved. Non-GAAP income was $6.6 million for the June quarter, up sharply from $1.7 million in last year's corresponding period. Revenue for the most recently ended period was $230.8 million, up 30 percent from $177.3 million a year ago. Surprisingly, revenue from professional services and other was $50.6 million in the quarter, a rise of 39.1 percent over the prior year while subscription revenue of $180.2 million was not as good, up 27.9 percent. Oracle announced that the NetSuite deal would be immediately accretive to results and one observer with a knowledge of P&Ls said since NetSuite has never earned money, the only way that would be possible is with some large layoffs. One cynic commented "Being Oracle I will bet you they keep the high-end, $1-million-plus deal hunters and fire the midmarket and partner people." Well, we'll know when we get there.

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