Hosted enterprise software vendor NetSuite has beaten expectations with its Q2 2009 financial results. The company recorded total revenue of $40.3m (£24.3m), up 10% on the year-ago quarter.
For the quarter ended June 30, the firm registered $32.5m (£19.6m) revenue from its US operations and $7.8m (£4.7) from international operations.
The company turned in a loss of $5.0m (£3.0m) for the quarter, which is an increase on the loss of $3.1m (£1.87m) NetSuite announced this time last year.
Revenue growth of 10% is impressive during a recession and Zach Nelson, CEO of NetSuite, was pleased with the results. “Once again, we delivered top-line and bottom-line results that exceeded expectations. We also generated operating cash in the quarter, well ahead of our plan. We remain on target to achieve our objective of posting break-even operating cash flow for 2009,” he said.
As well as exceeding expectations during the quarter the company also increased its average sales price on new contracts, showing a 33% increase on the previous quarter.
Nelson believes that the current economic situation will drive adoption of cloud computing as companies look for lower upfront costs and reduced ongoing costs associated with maintenance and support.
“A recent industry report indicates that NetSuite was rated as the fastest growing vendor in the top ten vendors of financial managements systems in North America. As customers accelerate their movement to cloud computing we believe NetSuite will continue to take share from our competitors,” said Nelson.
During the quarter the company announced the acquisition of Austin, Texas-based cloud computing vendor QuickArrow to help improve its offering in the professional services automation sector. QuickArrow will be integrated into its OpenAir business. NetSuite also announced OpenAir Mobile for Apple’s iPhone, a mobile version of its professional services automation platform.
