Word on the Rimini Street: Software support firm smiles through Oracle pain
Q3 sales up, global footprint enlarged post NASDAQ listing
Oracle and SAP support firm Rimini Street has reported an increase in revenues in its first quarterly results since being listed on the NASDAQ.
The firm brought in $53.6m in the three months ending September 30, up 32 per cent on the same quarter in 2016.
It also cut its net loss in two, dropping to $9m in Q3 2017, from $15.4m in the previous year. Meanwhile, it flipped from a $4.5m operating loss to a $7.4m operating profit.
The positive results suggest the firm isn’t suffering from its years-long copyright battle with Oracle, which mostly concluded last year and saw it saddled with multi-million dollar fines to pay.
Indeed, the company seems to have shrugged this off, having recently opened a new Latin American HQ in Sao Paulo, and a Parisian office - plus staff - for its newly launched French subsidiary, Rimini Street SAS.
It’s also expanded its support offering, having announced in the summer it had added IBM DB2 and Microsoft SQL Server to its books, also with 50 per cent savings on current annual vendor support fees.
The Q3 results are the first since the firm merged with investments corp GPIAC, which completed last month.
That move got Rimini Street listed on the NASDAQ without the risks involved with having to IPO, and is likely to offer the company access to more markets, not to mention cash.
According to the biz, Q3 also ended with 34 per cent more active clients than the same period in 2016 - up from 1,085 to 1,459 - and saw a 32 per cent boost in annualised subscription revenue, to $214.4m.
Although the results are unlikely to have Oracle and SAP quaking in their boots - they may be pause for thought.
As Angela Eager of TechMarketView pointed out, growth for a company offering your customers software support “represents a loss of business to them”.
The loss is effectively a drop in the ocean to the big vendors. In fiscal 2017, Oracle reported software licences updates and support revenues of $19bn.
But it still makes up 51 per cent of Big Red's total revenue, so any competition here is sure to act as another reason for vendors to push legacy customers towards the cloud with greater fervour.
That’s a slow process, though, and Rimini Street is continuing to grow. Eager noted that - although the biz needed to hire more experts to scale up - it “looks like it is keeping costs under control” during this expansion.
The firm has issued 2017 revenue guidance between $204m and $210m. For the nine months ending September 30, it brought in $154.7m, compared with $113.4m in Q3 2016. ?