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PeopleSoft quarterly profit up, software sales down

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CIOL Bureau
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PLEASANTON: Business automation software maker PeopleSoft Inc. on Thursday

posted earnings that rose 28 per cent year-over-year, in line with company

estimates, although software sales slipped 13 per cent amid still-soft demand

for high-tech products.

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The Pleasanton, California maker of software that automates human resources,

accounting, selling and other corporate tasks, said its earnings from recurring

operations were $46 million, or 14 cents per share, compared with earnings of

$36 million, or 11 cents, in the year-ago quarter.

Total revenue fell to $483.3 million from $514.2 million as software license

sales, a key gauge of performance, stumbled to $133.3 million versus last year's

$153.3 million.

"PeopleSoft was not immune to the slowdown in technology spending in the

first quarter," Craig Conway, PeopleSoft's president and chief executive,

said in a statement.

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On April 1, PeopleSoft had said its quarterly earnings would be 14 cents a

share, hitting the low end of previous guidance for a profit of 14 cents to 15

cents a share. It also warned that software license revenue would be $130

million to $135 million, below its prior forecast of about $160 million.

'Comeback kid'



PeopleSoft is considered by some investors and analysts to be the software
sector's "comeback kid." In recent quarters, the company has reported

positive year-over-year earnings growth on sales of its rewritten Web-based

software while rivals such as Oracle Corp. and Siebel Systems Inc. have

struggled to get their arms around declining profits.

The company, however, was floundering in the late 1990s when those

competitors were growing like gangbusters. Nevertheless, software sales in the

recently completed quarter posted less steep declines at PeopleSoft than Siebel

Systems' 27 per cent drop and Oracle's 29 per cent fall-off.

PeopleSoft's revenue warning earlier this month, however, tempered investor

optimism and sent company shares sharply lower. The stock, which finished 59

cents easier at $21.89 in regular Nasdaq trade, is down about about 44 per cent

so far this year. Elsewhere, shares of Oracle and Siebel Systems are off 24 per

cent and 15 per cent respectively.

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