RIM's numbers show 140% surge and BlackBerry becomes standard fare

Rethink IT, May, 2004

Cognos triggered the spending spree in the business intelligence market, moving for Adaytum at the end of 2002 to fill out its CPM line. Arch rival Business Objects has since swooped on Crystal Decisions, the ubiquitous reports company, and Cognos answered this by building its own reporting product, ReportNet.

Revenue for the quarter was $202.1m, up 23% over the fourth quarter of last year at $163.7m. Net income was up considerably more at $46m against $29.6m last time.

Business Intelligence revenue reached $195.1m in the quarter, up 26%, but ReportNet drove revenue growth hardest with $30m of new license revenue and over 1,000 ReportNet transactions, including deals at AT&T, Lockheed Martin, Raytheon, Ricoh, Sun Chemical, Telus Communications, Trillium Health, and the US Army.

And the company rolled out version 1.1 of ReportNet, with tighter integration with its BI tool PowerPlay.

The Cognos top end product is now called Cognos Enterprise Planning and this doubled its license revenue from the prior quarter and a new version was introduced, again claiming better integration with the older BI products.

Cognos signed 13 contracts greater than $1m, an all-time high for the company and 37 deals bigger than $1m for the full entire year. The company sits with $388m in cash.

Progress Software would no longer be recognized as a competitor to Cognos. It still has one of its founders, Joseph Alsop, running the company, and it operates as a bunch of acquired brands, including Progress of course, but also Sonic Software, DataDirect Technologies, the acquisition of which was completed this quarter, along with Nusphere, ObjectStore and PeerDirect.

It operates a repository-based development and deployment environment which has grown out of its roots, which is now called OpenEdge, it also has advanced middleware from Sonic Software, DataDirect gives it database connectivity. Progress also sells the business performance management tools of Corvu (another potential acquisition at some time) and is a reseller for Crystal Decisions. Progress sells the Fathom set of application management tools while Nusphere is Progress' brand of PHP development tools for web site creation and web services; Objectstore is what it says in the name, an object oriented data management architecture, and PeerDirect is software for synchronizing out office applications.

Each business relates indirectly to each other business, but they MI run separately and grow at different percentage rates and are driven by different business drivers, so it's difficult to get a handle on just how fast Progress will grow in the future. Overall its first quarter revenues are up 20% to $86.4m but for Progress (and also for Cognos), these revenues are inflated by around 7% to 8% by currency fluctuation.

Net income for Progress was up just 9% re $4.6m after taking out around $3m for in-process R&D on the DataDirect acquisition and for amortization.

The company's cash stands at $149m after paying our $88m for DaraDirect, but it is cash generative and more acquisitions shouldn't be ruled out.