Dutch-American software house The Baan Company reported first- quarter net income that fell far short of Wall Street’s expectations, posting net income of just $2.4m, or $0.01 per share. Analysts surveyed by First Call were looking for $0.11. The bottom line plunged 80.9% from the year-ago quarter’s $12.8m, while revenue increased 32.2% to $176.2m. The shortfall is due to accounting changes brought on by new US accounting procedures which affect the way software companies can recognize revenue. As a result, Baan ended the quarter with just over $100m in deferred revenue, up from last quarter’s total of about $30m. Net of the accounting change, overall revenue would have risen to $219m and earnings would have been $0.15 per share. Operating expenses also increased 40% in the quarter to $96.8m. On the heels of the news, Baan shares fell $3.875, or 7.3%, to close at $49.50.
