Cognos Reports Double-Digit Quarterly Growth

Business intelligence software vendor Cognos reported Thursday that sales increased 10 percent to $252.4 million in its second quarter ended Aug. 31, spurring a 12 percent gain in earnings to $26.5 million.

License revenue for the quarter was up 12 percent compared with a year ago to $87.0 million. About 32 percent of that was new license revenue -- a key indicator of growth. The company also reported that 26 percent of its license revenue was generated through the channel with 74 percent through direct sales.

"We delivered double-digit growth in total revenue and license revenue," president and CEO Rob Ashe said in a conference call. "Overall we delivered a good quarter and a solid first half to our fiscal year."

The results did not include sales or earnings from performance management software vendor Applix which Cognos is in the process of acquiring for $339 million.

Cognos inked nine contracts worth more than $1 million during the quarter and 129 contracts that exceeded $200,000. Support revenue increased 12 percent to $115.2 million during the quarter and professional services revenue increased 3 percent to $50.2 million.

Ashe said sales of Cognos 8, the company's flagship BI platform, grew more than 20 percent during the quarter. Cognos 8.2 is the current release of the product and Ashe said Cognos 8.3 is now undergoing beta testing. The CEO did not disclose a release date for the product, but he said it will include capabilities that will help users of Cognos' older PowerPlay product move to Cognos 8, as well as improved authoring tools and a new system administration console.

Sales for the six months ended Aug. 31 were $489.0 million, up 9 percent from the same period last year, the company said. Earnings surged 28 percent to $48.9 million.

For the third quarter Cognos expects sales in the range of $270 million to $285 million. For the entire year Cognos is projecting sales of $1.075 billion to $1.1 billion.