Vignette Reports 29.4% Revenue Plunge

By Irina Guseva | Published Feb 6, 2009

Following a round of layoffs at the dusk of last year, Vignette has announced 2008 fiscal year and Q4 2008 financial results. Total 2008 revenue has dropped 11.6% over 2007. Vignette's Q4 2008 total revenue was US$ 37.2 million, a decrease of 29.4% from Q4 2007.

As we've mentioned before, Vignette is going through some rough patches and keeps steadily losing revenue. Let’s take a closer look at the numbers and their impact.

VIGN Losing in the Numbers Game

Total revenue for fiscal year 2008 was US$ 169.5 million, a decrease from US$ 191.8 the prior year. GAAP net loss for the year was US$ 6.3 million, with EPS of US$ (0.27) — versus a profit of US$ 24.8 million, with EPS of US$ 0.89, in the prior year.

GAAP net loss for the year included US$ 3.7 million in restructuring charges incurred during the year. Non-GAAP income for the year was US$ 7 million, a decrease of 73.8% from fiscal 2007. Non-GAAP diluted EPS for the year was US$ 0.29 versus US$ 0.96 last year.

The 2007 results benefited from a US$ 7.4 million deferred tax credit adjustment to the income tax provision. For the full year, Vignette generated US$ 8 million of cash flow from operations.

"Despite a challenging economic environment in 2008, Vignette delivered operating profit and positive cash flow for the full year," said Mike Aviles, president and CEO of Vignette. "In 2009, Vignette is looking to build on its position as the leading independent provider of content management solutions. We are committed to keeping our balance sheet strong while we continue to enhance our product portfolio to position the company for the long-term."

Want the full picture? Check out VIGN’s earnings release.

Reviewing Vignette’s Year 2008

Vignette has been fairly busy in 2008 as far as product releases and updates go. Not that this activity has helped with the decreasing licensing revenue. In 2007, it was US$ 56 million. In 2008, it dropped to US$ 34.6 million.

Vignette released nine new products and 10 product upgrades were released in the key areas of Web Content Management, social media and Web experience optimization. But, clearly, more doesn’t always mean better.

We covered Vignette Media for you. It's a new publishing platform designed specifically for the TME vertical and built by re-using many of the already existing modules (think Vignette Video Services).

2008 product releases include:

Vignette Content Management 7.6
Vignette Community Services with content ratings, reviews, commenting and tagging capabilities
Vignette Community Applications with Web 2.0 features like blogs, wikis, forums and social microsites
Vignette Recommendations for content recommendations, product recommendations and social search functionality

Vignette Recommendations received the Best New Web 2.0 Technology award at the Web 2.0 Innovation Awards.

What’s Coming for Vignette in 2009

For one thing, Vignette is still alive and kicking from the social media strategy perspective. The content management industry has been abuzz with speculations about Vignette’s possible acquisition for years. Something along the lines of what recently happened to Interwoven.

In the spirit of market consolidation, Vignette can be seen as a potential candidate to be swallowed by a Java-friendly software giant like Oracle. Alternatively, once the ECM rockstar can just fade away… And there’s a new media strategist at VIGN to publicize the upcoming developments and news.

Although the industry is struggling, there are still some content management vendors that manage to attach the word “growth” to the word “revenue.” So, what exactly is happening to Vignette then? Where and why did it all turn sour?

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