In a financial reporting season that can’t have disappointed anyone, Autonomy has been no exception. The British infrastructure software company reported revenues of US$ 256 million for the second quarter of 2011, up 16% from the same quarter in the previous year.
And while the figures in general are good, there were a couple of things that the market will have been looking for, notably how its Iron Mountain (news, site) digital acquisition has behaved, how IDOL is getting on and how its cloud business is performing. In all three cases, performance has been good. And then there’s the added bonus of Aurasma, which appears to have fared better than expected.
Autonomy, Iron Mountain
To summarize the figures, Autonomy reported Q2 revenues of US$ 256 million, up 16% from Q2 2010, with strong performance in its cloud business with commits rising to US$ 465 million as of June 30, up from US$ 390 million in the last quarter, of which US$ 28 came from the Iron Mountain acquisition.
Given the general rebound of the software market and evidence that businesses are starting to spend on tech again, there are no real surprises here. Except, that is, the speed at which the Iron Mountain deal closed and how quickly Autonomy has managed to turn the digital business into an earner.
On that subject, Autonomy had this to say of the deal, in a statement released with the figures:
The Iron Mountain Digital asset acquisition also proceeded ahead of schedule, completing early after a smooth regulatory process. The acquisition generated less disruption than anticipated, leading to the business performing as expected but on an accelerated time scale."
Given that this only happened in May and Autonomy has already generated US$ 28 million in business, this bodes well for the coming quarters, especially given that the business from Iron Mountain digital is based around storage and is likely to see a lot of repeat action here.
IDOL in the Cloud
While the lower costs of cloud computing may have depressed Autonomy’s figures overall over the quarter, the potential here is enormous, and the fact that many of its customers went that route and the company still showed impressive quarterly figures overall can only be good.
Business in the quarter was marked by a rise in cloud business, with Autonomy's "commit" metric for hosted IDOL growing organically 27% year-on-year to US$ 437 million, which means a lot of new signups over the year.
On the cloud business, CEO Dr. Mike Lynch said:
Q2 and the first half saw a sharp further acceleration of our cloud business, seen again in the combination of growth in recognized cloud revenues of 17% (which excludes any contribution from the acquired IRM Digital assets) in Q2 and growth in new signings, evident in the rising commit number. Whilst success in the cloud has the effect of depressing short-term total revenue growth, with lower recognized revenue in the period, these incremental committed revenue streams amongst other factors lead us to positively revise our view of 2012."
Add into the mix that Autonomy now says it has 31 petabytes of customer data under management, making it one of the biggest private cloud storage companies and, again, it can only be good for the future.
The other noteworthy point in the figures this time around was the performance of its new reality software Aurasma, which only launched in May this year and, according to Autonomy, already has one million signups, including the New York Times and the London Underground, to the service.
Aurasma is an augmented reality platform that uses advanced image recognition technology to merge the physical and virtual worlds.
Using a smartphone or tablet, Aurasma is capable of recognizing objects in the real world and overlaying this view with an interactive layer of the virtual world.
The number of people using Aurasma to bring together the virtual and physical makes Aurasma the most broadly-deployed mobile platform of its kind," said Lynch in a statement.
He also said that it will be spinning off Aurasma by the end of the year, with Autonomy investors being given shares in the new company. This is similar to the strategy Autonomy applied to video search engine Blinkx in 2007, when it successfully spun that off.
In all, it’s been a good quarter for Autonomy. It beat market forecasts yesterday to deliver a 16% jump in quarterly sales. The result is that Autonomy has revised its profit forecasts for 2011 overall and initial projects for 2012. Things are looking good here.