So TIBCO Software
At the heart of the first-quarter report was $0.16 of non-GAAP earnings per share on sales of $185 million, in both cases slightly ahead of management guidance and analyst estimates. The company is more than holding its own in contract negotiations against much bigger rivals IBM
CEO Vivek Ranadive announced a tipping point in 2010 where TIBCO reached critical mass, and its sales growth is now building steam based on that platform. "Whereas content was king in the 20th century, TIBCO will prove that context will be king in the 21st century," Ranadive told analysts on this week's earnings call.
So the core business is doing well, with one exception: TIBCO needs to hire more support staff in order to keep up with customer demand for support services. At the moment, license sales are providing most of the growth, which is kind of backward when you compare TIBCO to other fast-growing software businesses such as salesforce.com
If that wasn't enough to power TIBCO through the rest of the year, a new product is turning heads. The Tibbr enterprise messaging system was launched two months ago and already reaches 100,000 paid customer seats. "To put that in context, salesforce launched their [Chatter] product a year and a half ago and now have about 50,000 users," Ranadive told me on a private call.
Tibbr is described as a universal inbox for tracking, receiving, and posting business events, replacing functions of email, data warehouses, and instant messaging. "It's a cross between a Facebook and a Twitter with all of the enterprise reliability, scalability, security all added," Ranadive said. He aims for 10 million paying users in five years, which makes for a serious revenue driver.
Not every investor believes the TIBCO story, perhaps because they don't understand it yet: About 5% of the float is sold short and the PEG ratio sits at an uncomfortable 2.0 based on growth estimates from unimpressed analysts. But the company is putting its money where its mouth is by buying back shares that "continue to be undervalued in relation to the Informaticas
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