On yesterday's third-quarter earnings conference call, Agile Software
Agile develops product lifecycle management (PLM) software, helping customers design, plan, sell and service products. With more than 11,000 customers, the company already controls a big chunk of the market, a mature category that grows less than 10% a year.
That sluggishness is apparent in Agile's earnings results. Revenues inched up from $32.8 million to $33.2 million, but license revenues ominously declined from $13.4 million to $11.5 million. License revenue is a key metric for software companies, because it often leads to ongoing service and maintenance fees.
Agile posted a net loss of $5.8 million, or $0.10 per share, compared to a net loss of $4.1 million, or $0.08 per share, in the year-ago period. Despite the red ink, Fulcher said his company has a lean cost structure.
PLM has always been a competitive space, but it's now getting even tougher. Over the past year, Dassault Systemes
Don't assume that Agile will fall to pieces, though. A strong product line and loyal customers should help buoy the company.
The competition mainly serves to limit Agile's growth, having plagued it with sluggishness for the past five years. For all his public optimism, unless Fulcher changes his strategy, or even sells the company, shareholders should expect little action from the stock.
Further foot-sure Foolishness: