Siebel latest IT company to warn of bad news ahead

Blames global economic and political uncertainties
Written by CNET Networks, Contributor

Blames global economic and political uncertainties

Siebel Systems expects first-quarter earnings and revenue to be lower than Wall Street estimates, citing global economic and political uncertainties that caused companies to postpone purchasing decisions. The software maker said on Friday that it expects to earn one cent per share on revenue of $330m to $335m in the quarter ended 31 March. Analysts polled by First Call had estimated Siebel would earn four cents a share, on average, on revenue of about $369m. In the same quarter last year, Siebel posted earnings of 12 cents per share on revenue of $477.8m. Siebel's warning follows a week of bad financial news from the business software sector. PeopleSoft, Sybase and WebMethods, among others each said sales and earnings for the quarter ended 31 March would miss Wall Street estimates. Speaking via teleconference, Siebel Chief Executive Tom Siebel compared the war in Iraq with the 11 September 2001 terrorist attacks in terms of its impact on corporate buying decisions. "As the quarter progressed, global economic and geopolitical conditions seemed to become even more challenging," Siebel said. "By mid-February, it felt in some ways like the September 2001 quarter." But when asked by a Goldman Sachs analyst whether he expected business to improve after the war, Siebel replied it was hard to say. He also called the economy the company's "biggest competitor". "It's possible that it is something other than war jitters," Siebel said. Siebel's first-quarter licence revenue, a key indicator of future growth, fell by more than 50 per cent to about $112m from $246m the year-ago quarter. Company executives said average deal size had declined and that several deals were postponed in the final days of the quarter. Siebel is scheduled to post full first-quarter results on 23 April. Alorie Gilbert writes for News.com
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