Linked by Thom Holwerda on Sun 5th Mar 2006 13:34 UTC, submitted by Moule
Novell and Ximian "It was not the best of quarters for Linux vendor Novell. When Novell announced its financial results for its first fiscal quarter, which ended Jan. 31, 2006, it reported revenue of $274 million [EUR 227 million], compared to revenue of $290 million [EUR 241 million] for the first fiscal quarter 2005. This was a decline from the previous quarter in which Novell had reported $320 million [EUR 266 million] of revenue."
Thread beginning with comment 101575
To view parent comment, click here.
To read all comments associated with this story, please click here.
ceo1
Member since:
2006-02-02

Novell has a price advantage over RH in the high performance computing area, where RH's price model is really very bad. HP and others have realized this and that's a big reason why they are supporting Novell for HPC use.

Is that enough to drive Novell's revenues where it should be? Of course not, but it is still a good grip on the market.

Reply Parent Score: 1

Moulinneuf Member since:
2005-07-06

"why they are supporting Novell for HPC use."

HP support anyone of value , getting there support dont equal that all there model shipping in any category are going to have Novell as default or even as an option.

Reply Parent Score: 1

moleskine Member since:
2005-11-05

The financial statement (and the previous one a few months ago) suggests that Novell's Linux/OSS side is doing OK. Not spectacular, and not as well as they'd like, but it has a good rep and it is growing.

The core of the problem with Novell is that the Linux/OSS side is a small fraction of the size needed to support the rest of the company which is doing badly. Essentially, Novell bet on a race: that they could grow their new Linux/OSS side fast enough to offset the decline in the rest of the company. For whatever reason, that bet hasn't paid off. The result is steady decline and shareholder unrest.

Since Novell are sitting on $1.7 billion in cash and short-term assets, they are at risk of some shareholders turning up and demanding that the company be broken up for hard dollars. This is the stock market for you and has nothing to do with the quality of SuSE Linux. Even if SuSE's sales doubled, the situation would be little different.

Reply Parent Score: 2

Moulinneuf Member since:
2005-07-06

"The financial statement (and the previous one a few months ago) suggests that Novell's Linux/OSS side is doing OK."

If all you watch is revenue. But revenue is not everything. Explain why they canned a lot of the GNU/linux developper then ? If its growing and the rest is in decline you cut the rest not whats improving. Reality most of what they bought whas hyped and not making real money or recurring profit.

"The core of the problem ... the company which is doing badly"

No , the problem is they invest to heavily , too soon in what dont bring that much in return. They still dont use everything and integrated everything they bought into a lean solution. They also have too many competiting solution inside the same company.

"Essentially, Novell bet ... the rest of the company."

No , they tought they bought the #2 company in a new and improving market , that they themself only touched partially. A good example would be if Wallmart had bought Apple to get into computer when they wehre down a bit. Apple is a real #2.

"For whatever reason, that bet hasn't paid off. The result is steady decline and shareholder unrest."

Trowing money at a problem and buying a lemon you tought whas a futur cash cow , is never going to help you be more profitable.

"Since Novell are sitting ... company be broken up for hard dollars. "

It dont make sense yet , they will ask that they spend less on R&D and push for better ROI.

"This is the stock market for you and has nothing to do with the quality of SuSE Linux."

Its a Novell protfolio , what they do and invest in them as impact on Novell bottom line. If they report 1 dolar investment for 5$ revenue the stock market will make the share value improve. For now they invest
100 000 for 1$ in revenue.

"Even if SuSE's sales doubled, the situation would be little different."

No it would mean that Novell just as to wait longuer , it all depends if they invest another billion to get that 54 milion more or they are just seling products on there own.

The stock market value of a share dont decide a company
futur , the management can use that 1.7 billion in many ways. One of wich could be to drive down the share price value of Red Hat and buy them at lower price. merging with Red Hat when they have enough voting share. Or they can offer to buy more other GNU/Linux company. etc ...

You still fail to recognise the problem , which make your fabulation and delusion absurd.

Novell did not make 54 million , how much did they make , do you even know ? What made that money ? wher ethat 1.7 Billion come from ? , this means that the rest made it and since they did not invest anymore in it , its highly profitable , hence the problem is the GNU/Linux division.

Reply Parent Score: 1