Manhattan Associates Profit Falls in Software Pullback

Manhattan Associates saw licensing revenue from its supply chain software fall more than 70 percent in the first quarter, all but wiping out the company's net profit.  

The company earned $262,000 in the first quarter, compared with profit of $7.4 million a year ago, and it warned that it could fall into the red in the second quarter.

Manhattan Associates said it is cutting costs, furloughing workers, eliminating 100 positions, suspending pension contributions and reducing salaries for executives, to meet what it says is sharply reduced supply chain technology spending by manufacturers and retailers.

“While our competitive win rate during the quarter continued strong, there simply weren't many businesses confident enough in the global economic outlook to commit capital to improve their supply chains,” said company President and CEO Pete Sinisgalli.

Manhattan Associates' software licensing revenue fell to just $4.9 million in the first three months of the year compared to $18.3 million in the same period a year ago. Overall revenue fell 32 percent, to $60.8 million. 

The company said in its guidance for the second quarter that it's earnings call range from a profit of about $3 million to a loss of about $460,000.  

Contact Thomas L. Gallagher at tgallagher@joc.com .