The runaway success of customer relationship management (CRM) products have hit sales at traditional enterprise resource planning (ERP) supplier Peoplesoft.
Revenue for the company's fiscal third quarter nosedived 14 per cent to $303.1 million, while net income plummeted 88 per cent to $5.2 million.
Earnings per share for the period ended 30 September stood at $0.02, compared with $0.17 last year.
Craig Conway, president and chief executive of Peoplesoft, blamed the figures on the "transition" of which the company and its industry sector are in the midst.
Organisations are now purchasing CRM products that can do much the same work as ERP products but with a focus towards customer service.
To counteract this trend Peoplesoft last week announced its much anticipated intention to acquire CRM supplier Vantive. However, Vantive has lost much of its power in the industry as it has struggled to outpace arch rival Siebel Systems in the sales force automation sector.
According to analysts, Vantive has growth rates of 20 per cent, far below the 80 per cent and 60 per cent enjoyed by Siebel and Clarify, respectively.
Peoplesoft's revenue from international operations increased eight per cent to $59.4 million, or 20 per cent of total revenue, compared to $55 million or 16 per cent of the business last year.
Conway continued: "We are achieving our goal of delivering a new generation of enterprise applications that provide a 360 degree view of an enterprise's customers, suppliers and employees."
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