Well I'm still somewhat disappointed but things are o.k.
Increase in G&A Expenses - I had been worried about this but it was mostly one time expenses associated with a patent infringement case that settled in late September.
Expenses in general have increased substantially and while no one obviously likes that, the reasons are: (1) increased marketing efforts, (2) wage inflation in India and (3) increased expenses for supporting Cisco. The revenue associated with the first and third item take time and the switch to hosted model results in further delay.
Cisco OEM - Relief to hear about that. They have meet the second key objective and the third and final objective is expected to be in the third quarter. It is in the back half of the year that Cisco is expected to start generating non PSO revenue.
There are good arguments for buying here. I don't think the second quarter will be substantially better than this quarter but beginning in the third and fourth quarters I think we can begin to expect to see some improvements.
Oh yea; hosted revenue up 25% YOY. That is a good story to sell; just wish it had a larger starting base.
Range of expectations for total gross revenues for 2008...$26.2 million to $31 million?
"...Therefore, we expect our license revenue for fiscal year 2008 to be in the range of $5.2 million to $9.0 million. We expect our support and services revenue for fiscal year 2008 to be in the range of $21.0 million to $22.0 million..." http://biz.yahoo.com/iw/071108/0326408.html
Just wanted to point out an inconsistency in something I said. I indicated that I think things will begin to happen in the latter half of the year and while that makes sense with regard to Cisco it doesn�t make sense on other revenues. Remember the fourth quarter was unprecedented and most of that revenue was deferred to FY08; that means they have some ground to make up in the latter half of the year.
So in other words I�m not aware of anything to indicate that they will suddenly become profitable. Maybe Cisco will get them there; I hope so but the odds are certainly less than 50% in my opinion.