Basware and Oracle disappoint investors

We covered Basware’s last annual results here, and also the release of their impressive new spend analytics solution here. But a couple of weeks ago, Basware announced that they have lowered their 2013 estimates. Originally they estimated a >15% growth in net sales and growth in operating profit compared to the previous year. They have since retracted this, and now (less specifically) expect 2013 net sales to “grow” and operating profit “to be positive”. The change in estimates is because the growth in net sales fell short of targets, which is claimed to be “due to delay with the new generation Alusta platform”.

Certipost, their recent acquisition in Belgium, also appears to be turning into a problem: “ the company estimates that the operating profit of Certipost's business..  to be approximately EUR 1.8 million negative for 2013, while the original full-year estimate was slightly positive”.

Their share price immediately fell a little, but in a declining market over the last weeks it hasn’t done too badly – however, it is currently at its lowest since December 2011. There’s clearly going to be a lot of focus on turning Alusta and the strong new products into real revenues as quickly as possible.

However, it’s not just Basware of the P2P / ERP providers who are suffering. Oracle are having a disappointing time – of course, procurement is only one small part of their portfolio, but overall the firm is struggling to regain the momentum they’ve shown for years.  “For the third quarter that ended in Feb. 2013, Oracle reported a decline in revenue of 1% year-over-year, reaching $9 billion. New software licenses and cloud software subscription revenues have fallen 2% to $2.3 billion”.

Can Oracle, SAP, IBM, Basware and indeed others make the transition to the new cloud-based technology world? I wouldn’t bet against it for any of them, but there may be a few painful moments along the way. And that’s probably what we’re seeing at the moment.

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