NetSuite results hurt by high business costs

NetSuite reported quarterly revenues of $41.7m

NetSuite's quarterly financial results show a loss of $8m (£4.8m), despite increased revenue and cashflow.

Zac Nelson, chief executive at NetSuite, said in an earnings statement that the company is positive about the market outlook, and is weathering the "gale force economic winds".

"We modelled the third-quarter results to be seasonally flat from the second quarter, so the fact that we exceeded most of our metrics is indeed exciting," said Nelson.

"We have seen record revenue, record cash flow, continued non-GAAP profitability, our best new bookings growth in a year, reduced downsell and increased upsell and the largest number of OneWorld customers ever sold. All of these bode well."

NetSuite said that revenue had risen four per cent to $41.7m (£25.2m) for the quarter, and that the company generated $2m (£1.2m), making it cash-flow positive for the year. It was also NetSuite's best new business quarter ever.

However, increasing business costs, especially marketing and administrative costs, had risen sharply and had hit the company's results.

Sales are expected to rise further in the fourth quarter of the year, according to Nelson, which is traditionally NetSuite's strongest time of the year. The firm also reported increasing demand for its products in mid-sized businesses in Europe and Asia.