Jul 26, 2007 1:21 PM,

U.S. still a drag on InfoVista

By Tim McElligott

Performance management will be an increasingly important market segment as carriers transition to next-generation platforms, but as Paris-based software company InfoVista showed today through its earnings call, better days may still lie ahead.

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The company, whose U.S. presence is in Herndon, Va., struggled with its revenue generation in the Americas, dropping 14% in its fiscal fourth quarter from last year’s fourth quarter. License revenues dropped 28%, although the license revenue decrease was slightly offset by a rise in services (3%) and maintenance (7%). License revenue accounts for 48% of overall revenue for the company.

Philippe Ozanian, president and CFO at InfoVista, said the company’s disappointing results are essentially due to a lack of performance in the Americas. However, he said there is a new management team and new sales executives in place. “Execution is improving, and the sales strategy has been tuned,” he said. “Combined with major product releases scheduled for the fall, we can ensure a return to normalized levels during the second half of fiscal year 2008.”

Overall, year-over-year revenue grew by 1%.

Alain Tingaud, chairman and CEO, said he anticipates InfoVista will continued to face challenging conditions in the U.S. However, given initial results of initiatives now in place, he confirmed the company’s guidance for the fiscal year 2008 of 10% revenue growth.

InfoVista has no debt and has cash equivalents and marketable securities of EUR 36.3 million as of June 30, 2007, slightly down from last year at this time.

Revenue from the EMEA region fell 6% as well. However, last year they were up by 38%. During the last quarter, InfoVista recognized revenues from major deals with Telefonica in Spain and Germany, and signed a significant deal with BSkyB, a provider of broadband services, and added Telecom Italia as a customer.

Earlier this year, InfoVista signed a $15 million software deal with Microsoft and became the first performance management software company to join the Metro Ethernet Forum.