License Revenue Slide Continues For SybaseLicense Revenue Slide Continues For Sybase

Sybase Inc. reported Thursday that despite the economic slump, revenue for its second quarter ended June 30 held steady, compared with one year earlier. But a worrisome slide in the software vendor's license revenue continued during the quarter, and one-time charges pushed the company's bottom line well into the red.

For the quarter, Sybase reported revenue of $234.4 million, up a fraction of 1% from $234.1 million in the same period last year. But the company reported a loss of $39.5 million, or 42 cents per share, compared with earnings of $13.4 million, or 15 cents per share, one year earlier. The company attributed the loss to charges associated with its acquisitions of Home Financial Network Inc. and New Era of Networks Inc. On a pro forma basis, Sybase said that net income was $22.6 million, or 24 cents per share.

The database and E-business software vendor's license fees declined nearly 15% to $94.7 million from $110.9 million one year ago. License revenue decreased nearly 11% in the first quarter. Software-license sales are widely seen as an indicator of a company's growth. Sybase's total revenue was flat because service-related revenue grew almost 14% to $139.7 million from $123.2 million last year.

Sybase president and CEO John Chen told Wall Street analysts Thursday that the company is working under the assumption that the North American market will remain weak for at least another quarter or two. CFO Pieter Van der Vorst said the number of deals valued at $1 million or more dropped to 9% of Sybase's total revenue from more than 20% in previous quarters. He said, "The deals are being delayed and scaled back, but not canceled."