Portal Software (Nasdaq: PRSF) plunged US$3.07 to $6.21in morning trading Monday, after the business software maker said it expectslower revenue and a bigger loss for the quarter ended April 30th.
Portal, based in Cupertino, California, also said it will cut jobs and takeother steps to reduce costs as a slow economy causes customers to put offsoftware purchases.
Revenue for the quarter will likely total $42 million to $44 million, belowprevious projections, with a pro forma loss of 19 to 22 cents per share,Portal said. Analysts were looking for a profit of a penny per share.
CIBCWorld Markets reportedly downgraded Portal to buy from strong buy after thenews.
Pro forma figures exclude amortization of goodwill and developed technologyrelated to the acquisition last November of Solution42.
“While we anticipated a slowdown in economic spending by technology andcommunications companies, the overall global downturn was greater than wehad anticipated,” Portal Software chief executive officer John Little said, echoing comments made by other software company heads.
“We will be taking aggressive cost-cutting measures to reduce our expensesthroughout the company in an effort to meet our business objectives in theshort and long term,” said Little.
The company said it will cut expenses by 20 to 25 percent this quarterthrough a combination of job cuts, facilities consolidations and write-offs.A charge for the restructuring actions will be included in results for thequarter ending July 31st, Portal said.
Portal, which sells its products to companies including AOL Time Warner,Qwest Communications and Sprint, said it plans to report results on May17th. The company employs about 1,500 people at more than 40 offices aroundthe world.