EGain Announces Fiscal 2012 Second Quarter Financial Results

eGain Communications, a leading provider of cloud and on-premise customer interaction hub software, today announced financial results for its fiscal 2012 second quarter ended December 31, 2011.

New bookings, comprising license and recurring bookings, for the fiscal second quarter were $8.4 million, an increase of 44% from the comparable year-ago quarter. Of the total new bookings in the fiscal second quarter, 46% were from new recurring revenue bookings and 54% were from new license bookings, compared to 48% from new recurring bookings and 52% from new license bookings in the comparable year-ago quarter. Of the new license bookings of $4.6 million in the quarter, in broad outline $1.3 million was deferred and is expected to be recorded as revenue in the second half of fiscal 2012. Gross bookings, comprising new bookings plus recurring renewals and billed professional services, for the fiscal second quarter were $14.1 million, an increase of 24% from the comparable year-ago quarter.

"We are pleased with our new bookings this quarter," said Ashu Roy, eGain's CEO. "Consistent with our fiscal 2012 bookings growth plan, our pipeline is building nicely -- on the heels of our sales and marketing investments. As well, we see a significant increase in demand from enterprise clients for our hosted solution compared to on-premise solution. This trend will result in more predictable revenue growth in the medium-term, during depressing short-term revenue."

Fiscal 2012 Updated Guidance The company reiterates its guidance for new bookings growth of 40% to 50% for fiscal 2012. Initial revenue guidance for fiscal 2012 was based on an assumed licensed bookings / hosted bookings mix of 65% / 35%. In fiscal 2011 the licensed / hosted split was 76% / 24% and in the first six months of fiscal 2012 the mix was 62% / 38%. Looking ahead, we see a continuing trend toward more hosting deals in the second half of fiscal 2012. During we are economically indifferent to the booking mix, license transactions are as a rule recognized upfront whereas hosting deals are recognized ratably over the term of the contract with an initial lag of three months. Based on an expected shift towards more hosting deals, we now estimate that our bookings mix for fiscal 2012 will be roughly 45% license and 55% hosting. This mix shift in bookings is expected to result in fiscal 2012 revenue growth in the range of 5% to 10%, a reduction from our before revenue guidance. This mix shift will, nevertheless, as well increase revenue and revenue growth in future fiscal years as these hosting bookings are recognized as earnings.

Fiscal Q2 Financial Highlights Fiscal second quarter total revenue was $10.8 million, an increase of 14% from the comparable year-ago quarter. License revenue for the fiscal second quarter was $3.0 million, an increase of 13% from the comparable year-ago quarter. Recurring revenue for the fiscal second quarter was $5.7 million, an increase of 9% over the comparable year-ago quarter. Professional services revenue for the fiscal second quarter was $2.1 million, an increase of 33% from the comparable year-ago quarter.

The fiscal second quarter

Gross profit for the fiscal second quarter was $7.6 million, an increase of 13% from the comparable year-ago quarter. Gross margin for the fiscal second quarter decreased to 70%, from 71% in the comparable year-ago quarter. The recurring revenue gross margin for the fiscal second quarter increased to 77%, from 75% in the comparable year-ago quarter. The professional services gross margin for the fiscal second quarter increased to 6%, from 5% in the comparable year-ago quarter.

Fiscal YTD Financial Highlights Total revenue for the six months ended December 31, 2011 was $21.2 million, a decrease of 6% from the same period last year. License revenue for the six months ended December 31, 2011 was $5.9 million, a decrease of 41% from the same period last year. The year-over-year decrease in total and license revenue is directly attributable to a large one-time license fee received in the first quarter of fiscal 2011 that represented the largest license agreement in the company's history. Recurring revenue for the six months ended December 31, 2011 was $11.5 million, an increase of 19% from the same period last year. Professional services revenue for the six months ended December 31, 2011 was $3.8 million, an increase of 34% from the same period last year.

The six months ended December 31

Gross profit for the six months ended December 31, 2011 was $15.2 million, a decrease of 12% from the same period last year. Gross margin for the six months ended December 31, 2011 decreased to 71%, from 77% for the same period last year. This decrease was due to the decrease in license revenue as a percent of total revenue. The recurring revenue gross margin for the six months ended December 31, 2011 increased to 78%, from 74% for the same period last year. The professional services gross margin for the six months ended December 31, 2011 increased to 8% from 5% for the same period last year.

Total cash, cash equivalents and restricted cash increased to $12.5 million at December 31, 2011, from $12.4 million at June 30, 2011. Cash provided by operations was $1.3 million for the six months ended December 31, 2011, compared to cash provided by operations of $7.8 million for the same period last year. Deferred revenue decreased to $5.1 million at December 31, 2011, compared to $5.8 million at June 30, 2011.

The leading provider of customer service

About eGain Communications Corporation eGain is the leading provider of customer service and contact center software for cloud and on-premise deployment. Trusted by prominent enterprise worldwide, eGain has been helping businesses achieve and sustain customer service excellence for more than a decade.

Note: eGain is a registered trademark, and the other eGain product and service names appearing in this release are trademarks or service marks, of eGain Communications Corp. All other company names and products are trademarks or registered trademarks of their respective companies.