Novell profit falls as revenue dips amid uncertainty over review by company’s board

Novell 3Q misses expectations as revenue dips

WALTHAM, Mass. — Networking software maker Novell Inc. said Thursday that its third-quarter net income fell as revenue dropped amid customer uncertainty over the company’s possible sale.

Net income in the three months to July 31 fell to $15.7 million, or 4 cents per share, from $16.7 million, or 5 cents per share, from a year ago.

Revenue dropped 8 percent to $199 million from $216 million.

Adjusted for one-time items, earnings fell to 6 cents per share, narrowly missing the 7 cents per share expected on average by analysts polled by Thomson Reuters. Analysts were also expecting revenue of $200 million.

Shares, which had shed 7 cents, or 1.2 percent, to $5.64 in the regular session, slipped another cent to $5.63 in after-hours trading.

CEO Ron Hovsepian said the revenue came in below expectations mainly because customers were uncertain about the ongoing review by the company’s board to seek out ways to enhance shareholder value.

The board began the review in March after rejecting a $2 billion takeover offer for $5.75 per share in cash from private equity firm Elliott Associates L.P. The company has been considering alternatives including a joint venture or possible sale.