i2 Reports Down Quarter, Files Lawsuit Against Oracle

Revenue drops 10% for the supply chain stalwart, as the company mounts a legal battle against Oracle over the use of nearly a dozen patents.


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Posted on May 07, 2009

Stand-alone supply chain software provider i2 Technologies today reported first-quarter numbers that echoed those of other enterprise technology purveyors dogged by the recession, with flagging license sales leading a revenue slide. The news came on the heels of i2’s announcement that it has filed a lawsuit against Oracle Corp. alleging patent infringement.

For the three months ended March 31, i2 reported revenue of $56.4 million, down 10% from $62.6 million in the first quarter of 2008. However, unlike many of its enterprise software peers, which have enjoyed higher support and maintenance revenue to counteract license falloff, i2’s sales declined across all three business lines, with software off 13% to $10.2 million; services down 7% to $26.8 million; and maintenance falling 12% to $19.4 million.

“New license sales are down everywhere,” said Ray Wang, a vice president of research at analyst firm Forrester. What’s concerning in i2’s case, he said, is the concurrent falloff in maintenance sales. Wang expects the company to work to boost that number in quarters to come.

Meanwhile, i2’s cost-cutting efforts helped contain the damage to the bottom line, which slid 7% to net income of $2.7 million. During the quarter, the company tapped into its cash reserves to wipe out nearly $65 million in long-term debt.

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