I2 Technologies Inc. said its earnings were below estimates as revenue fell from sales and maintenance of its supply-chain-management software. The stock fell 30 percent, the most in 18 months.
Shares fell $7.69 to $17.77 as of 4 p.m. New York time in Nasdaq Stock Market composite trading. I2 had gained 45 percent in the past year before today.
Net income rose to $3.5 million, or 13 cents a share, from $1.2 million, or 4 cents, a year earlier, I2 said in a statement. The Dallas-based company was expected to earn 23 cents a share, the average estimate of three analysts in a Bloomberg survey. Revenue rose to $65.6 million from $64 million a year earlier.
``We don't believe this constitutes a trend, and we aren't changing our outlook for the year,'' Chief Executive Officer Michael McGrath said on a conference call. I2 expects to earn 90 cents to $1.10 a share this year.
Revenue in I2's software solutions division fell 21 percent to $13.4 million, from $16.9 million a year earlier, while maintenance revenue declined 9 percent to $21 million. Service revenue rose 20 percent to $28.7 million, compared with $23.9 million a year earlier.
``The majority of the decline in maintenance revenue was due to contract renegotiations and renewals being pushed into future quarters,'' said Michael Berry, chief financial officer.
Search for CEO
I2 also said it has started a search for a new chief executive officer to replace McGrath, whose contract expires at the end of the year.
``It's time to bring in a new leader who can commit to the next five years and lead the company through the next generation of products,'' McGrath said.
Separately, I2 said it bought Blue Agave Software Inc. to provide retailers with improved software to track inventory. Details of the deal weren't disclosed. The company also said it won a contract with Costco Wholesale Corp. (COST:US) for software to consolidate North American transportation and distribution costs.
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