Spyglass Shares Surge on $20m Microsoft Deal

Computergram International, April 8, 1999

Spyglass Inc said Wednesday it has signed a deal with Microsoft Corp that will guarantee the company a minimum of $20m in revenue over three years. Shares of the Naperville, Illinois browser developer responded to the much-needed good news by nearly doubling to from $8.875 to $17 in heavy trading, before closing the day up $4.75, or more than 53%, at $13.625. Spyglass shares had been in a downward spiral since hitting a 52-week high of $32.25 in January, just before the company reported poor first- quarter results.

The new deal will see Spyglass both license technology and provide services to Redmond in an effort to accelerate the development and deployment of Windows CE-based products. The two say they will work closely to develop and integrate CE-based applications for manufacturers of internet devices and will explore ways to use Spyglass technology to enhance the operating system itself.

The agreement is a huge one for Spyglass, which last quarter posted a loss of $2.2m on revenue up 6.3% year-over-year at $4.5m. A slip in licensing revenue due to the lack of anticipated deals such as this one was given as the main cause for the poor quarter. The company had signed a similar $20m deal with set-top box maker General Instrument last October to build services and applications for the company's digital cable platform.