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TIBCO Software, Inc. (NASDAQ:TIBX)

F1Q08 Earnings Call

March 27, 2008 4:30 pm ET

Executives

Vivek Ranadivé – Chairman and Chief Executive Officer

Murray Rode – Executive Vice President & Chief Financial Officer

Analysts

Sterling Auty – JP Morgan

Tim Klasell – Thomas Weisel

Derek Bingham – Goldman Sachs

Eric Slavinski - Jeffries & Company

John Walsh - Citi

John DiFucci – Bear Stearns

Alan Cooke – Merrill Lynch

Raghavan Sarathy – Ferris, Baker Watts

Operator

Good Afternoon, ladies and gentlemen. I am Rebecca. Welcome to TIBCO’s First Quarter 2008 Conference Call. At this time all participants are in a listen only mode. Later we will take your question and answer session. You can also listen to the call via the Internet at www.tibco.com. Today’s call is being recorded and will be available for playback from TIBCO Software web site at www.tibco.com. In addition, replay will be available through Premier Global Services for one month following today’s call by dialing (888) 203-1112 from the U.S. or (719) 457-0820 internationally. The confirmation code is 4035043.

The following conference call includes forward-looking statements which represent TIBCO Software’s outlook and guidance only as of today and which are subject to risks and uncertainties. These forward-looking statements include, but are not limited to, forecasts of revenue, operating margins, operating expenses, outstanding shares, and earnings per share for future periods. Our actual results could differ materially from those project in such forward-looking statements. Additional information regarding the factors that could cause actual results to differ materially are discussed in the Risk Factors section of TIBCO’s most recent reports in Forms 10-K and 10-Q filed with the Securities and Exchange Commission. TIBCO assumes no obligation to update the forward-looking statements included in this call whether as a result of new development or otherwise.

This conference call also includes certain financial information that has not been prepared in accordance with generally accepted accounting principles as we believe that such information is useful for understanding our financial condition and results of operations.

For our presentation comparable financial measures calculate in accordance with GAAP and a reconciliation of the differences between the non-GAAP and GAAP financial information. Please see our website at www.tibco.com.

The participants on the call are Vivek Ranadivé, TIBCO’s Chairman and Chief Executive Officer and Executive Vice President & Chief Financial Officer, Murray Rode.

I would now like to turn the call over to Vivek.

Vivek Ranadivé

Thank you, Rebecca, and hello everyone. Now we appreciate you joining us on our Q1’s Earnings Call. Before we begin I want to point out Murray and I needed to make this call from different locations—just in case you notice a moment of pause from us in the Question-and-Answer session.

On today’s call I will discuss three things: first, I will briefly review our Q1 performance; second, I will provide an update on some focus areas for driving growth; and third, I will share some insights on the broader market and TIBCO’s opportunity.

Let me start with our Q1 highlights. Total revenues were $146.6 million resulting in year-over-year growth of 17%. License revenues were $57.8 million, up 11% on a year-over-year basis, and fully-taxed non-GAAP fundings per share for the quarter were $0.07.

From a customer standpoint, we increased and expanded our business with market leaders across industries, including AT&T Mobility, Deutsche Bank, Immigrants Bank, Fannie Mae, Infinity Property & Casualty Company, Lexus Nexus, Live Nation, and Alliance communications.

Overall, this was a good quarter and a solid start to our year with healthy performances coming, in particular, from the Americas and key verticals such as financial services, life sciences, manufacturing, and teleco. Still, we have further progress to make in realizing our full potential as we go through the year.

On our last call I highlighted three focus areas for driving growth. Now I will provide an update on each. First, I spoke of the need to expand our field sales capacity. I am pleased to announce that we have increased our quarter carrying reps by 18 over Q4, getting approximately halfway to our goal of 40 additional reps this year. I am extremely pleased at the quality of these new reps and confident in the eventual contribution they will bring to our business.

Second, as relates to growing our ecosystem of partners we see continued progress in this area, such as a deepening relationship with Infosys, who is a key sponsor of our upcoming user conference, expanding joint business with EDS Worldwide, and a growing OEM channel.

Third, I mentioned M&A as a continued focus area. Spotfire has been very successful for us and we remain actively engaged across a variety of other opportunities. We continue to see potential for accelerating our growth through acquisitions.

I will wrap up my comments with a few words on the broader market opportunity. The growth opportunity for TIBCO is expanding, not contracting, even in these uncertain economic times. I say this because of several forces affecting business today such as the increasingly complex and global nature of customer and partner relationships, the ever-expanding influence of the Web, and the exploding number of interactions between people and systems taking place across the Web and corporate networks.

These forces are putting great pressure on the software infrastructure to make sense of it all. In other words, this problem is tailor made for service-oriented architecture, or SOA. Database-oriented architectures of the past are simply not equipped to provide the flexibility and responsiveness that companies now require. TIBCO is the only full-service provider to deliver a neutral infrastructure platform for SOA that connects it all, automates processes end-to-end, and equips users for new analytical insight. What we offer is not nice-to-have technology, it is now a must-have for everyone. We see recent evidence of this in spite of the clear volatility in economic conditions.

Consider again that we delivered a record quarter from our financial services business the past Q4 and then follow that up with another strong Q1 in financial services. While we can’t state precisely what lies ahead in the larger macro environment, we are confident that our game-changing offerings will continue to be viewed and pursued as enablers of competitive advantage.

Now I will turn it over to Murray to provide some additional detail on the quarter’s performance and outlook. Murray.

Murray Rode

Thanks, Vivek.

I will split my comments into two parts, first providing some additional details on our financial performance in the quarter and second, providing our outlooks for Q2 and the rest of the year. I will review our financials on both a GAAP and non-GAAP basis, a full reconciliation of which was included in our press release along with an explanation of our non-GAAP measures.

Some key data on the first quarter results are as follows: Total revenue was $146.6 million, up 17% year-over-year; license revenue was $57.8 million, up 11% year-over-year; services and maintenance revenue with $88.8 million, up 21% year-over-year.

Non-GAAP gross margin was 74% in the quarter. Non-GAAP operating income was $18.9 million resulting in an operating margin of approximately 13%, which was at the high end of our guidance for the quarter.

Overall, operating expenses came in slightly under plan despite the quarter carrying hires we made during the quarter.

This Q1 we also have the effect of Spotfire included in our results, which, as we expected, added to revenue but not margin in this first quarter. However, as we progress through the rest of the year we will see increasing margin leverage. And this is all incorporated into the guidance I will provide later in my comments.

Non-GAAP EPS was $0.07 versus $0.07 a year ago.

The non-GAAP tax rate for the quarter was 34%.

Deferred revenue was $149.4 million. This includes both the long and short-term components and was up almost 6% from Q4 and up about 41% from Q1 a year ago.

DSOs came in at 70 days, down sequentially from Q4 and down from Q1 a year ago.

We had cash flow from operations of approximately $60.2 million, which compares with $42 million last Q1. We ended the quarter with about $286 million in cash and short-term investments despite having repurchased 6.2 million shares at an average price of $7.34 per share.

The geographic breakdown of revenue was as follows: the U.S. represented 53% of total revenue; Europe 38% of total revenue; and Asia-Pac 10%.

Total revenue by vertical was as follows: financial services, 27%; telecommunications, 11%; life sciences, 8%; manufacturing, 8%; energy, 7%; government, 5%. No other industry represented more than 5% of revenue.

The approximate allocation of license revenue by product family—and I stress approximate, given the frequency of bundled product sales—was as follows: SOA was 61%; business optimization, 28%; and BPM, 11%. Although BPM wasn’t high on allocated revenue this quarter, it was a key driver in a variety of larger platform sales.

Our top ten customers represented 22% of revenue, somewhat less concentrated than recent past quarters, and we had 14 deals, over $1 million in license. License deals over $100,000 rose to 87% versus 75% in the year ago period. Four license deals over $100,000, the average deal size was approximately $602,000 versus $687,000 in Q4 and $652,000 in Q1 a year ago. We added about 30 new license customers in the quarter versus 15 in the year-ago period.

One last statistic that Vivek mentioned that I want to reiterate is our quota headcount, which has risen by 18, taking our total current quota heads to 170. As we indicated entering the year, the number of quota heads is a limiting factor on our growth and we look to these additional quota heads to help us capture untapped market opportunity. Our target is to reach about 190 quota personnel by the end of the year. So far we’ve been hiring to plan successfully.

Now, looking forward, we are reiterating our full year guidance, which is total revenue between $660 million and $670 million and $0.43-$0.45 in non-GAAP EPS. We expect an operating margin for the year of 19%-20% which reflects an additional 150-200 basis points year-over-year.

For Q2 we expect total revenues to be between $153 million and $156 million with license revenue in the range of $65 million-$68 million. Our operating margin should be 13%-14% on a non-GAAP basis. This includes some small operating expense increases over Q1, primarily in R&D and sales and marketing, and mostly due to seasonal factors such as our annual user conference, TUCON, which will take place April 29-May 2.

Looking at the outlook for EPS, one important component is our income from cash and investments and given current rates and market conditions we have taken an even more conservative posture with our cash and investments, so we’re expecting other income to be in the rage of $1.5 million-$1.8 million. We factored this into our guidance for Q2 and the full year. So for Q2 we expect non-GAAP EPS to be $0.08, with GAAP EPS of $0.03.

As it relates to cash flow, we had a very strong quarter, which we do not expect to repeat in Q2, although we do expect operating cash flow to grow by 20% or more for the year. We typically see seasonality with operating cash flow and given how large Q1 was, Q2 is likely to be lower due to seasonality.

Summing up our outlook and growth strategy, we do feel that we have a large growth opportunity ahead of us despite current macroeconomic conditions so we will continue to make targeted investments in our products and sales capacity while otherwise carefully controlling costs. We do seek margin expansion, as our annual guidance indicates, but our primary focus is top-line growth, as we believe this will ultimately yield the best result overall for shareholders.

And with that Vivek and I will be happy to take your questions.

Question-and-Answer Session

Operator

(Operator Instructions) And from JP Morgan, we’ll hear from Sterling Auty.

Sterling Auty – JP Morgan

Yeah, thanks. Hi, guys. I wonder if you could just comment, given the macro environment that we’re in, what you saw in terms of close rates at the end of the quarter and sales cycles.

Vivek Ranadivé

Sterling, we didn’t see much impact from the economic environment, either in Q4 or in this quarter. Murray, do you want to elaborate on that further?

Murray Rode

Yes, Sterling, it did behave like a fairly typical Q1 for us. So, at least in terms of the business that closed, we can’t point to specific circumstances that macro issues came up.

Sterling Auty - JP Morgan

Okay. And then can you give a little more clarity—you mentioned that the deferred revenue was awfully strong, with 41% growth. How much of that was just strong renewals on maintenance and how much of it was other things that were going into it?

Murray Rode

The increase sequentially was all--almost entirely maintenance related.

Sterling Auty - JP Morgan

All right. Thank you.

Operator

And from Thomas Weisel Partners we’ll hear from Tim Klasell.

Tim Klasell - Thomas Weisel

Congratulations, guys, on a good quarter. Can you give us a little bit of color on how Spotfire did, and then you mentioned that you expected to add to net margins—did it add to cash flows this quarter?

Murray Rode

Yes, Tim, in terms of Spotfire’s contribution, if you think about the license breakdown we gave, Spotfire was over half of the business optimization category, and in terms of cash flow it added about $8 million or so to the cash flow in the quarter.

Tim Klasell - Thomas Weisel

Okay, good. And I also wanted to ask as well, how was Europe in trending for you, particularly in the UK financial services market, where I know you guys have historically had a pretty good footprint?

Murray Rode

As you know, the last couple of years, actually—both 2006 and 2007—Europe was a pretty good performer. This quarter, America, on a relative basis, the Americas was stronger than Europe. But I wouldn’t say that we saw any particular issues in Europe, specifically financial services in Europe.

Tim Klasell - Thomas Weisel

Okay, good. And then one final question. Can you just give us some color on ActiveMatrix? How is the uptake running there and how are you feeling about that product right now?

Murray Rode

We feel good about the product. We have really been, I would say, in full swing with it really only for a couple of quarters and we have over 50 customers that have the product. It’s pretty frequently sold as part of the broader SOA platform and that’s how we intended it. It seems to be happening as we expected.

Vivek Ranadivé

We’re also starting to see some OEM interest in it, which could be quite exciting for us as well.

Tim Klasell - Thomas Weisel

That’s interesting. Very good. Thank you very much, gentlemen, and congratulations again.

Operator

And from Goldman Sachs, we’ll hear from Derek Bingham.

Derek Bingham - Goldman Sachs

Murray or Vivek, could you give a little more color on what’s happening on the OEM front and what kind of goes to that deal, there about?

Vivek Ranadivé

Yes, we’re sorry to see that people want to use our SOA stack and bundle it with the products that sit on top. Murray, I don’t think we’re allowed to mention names?

Murray Rode

Yes, unfortunately not just yet, for the call, but I think we’ve got some interesting strategic partnerships forming up around it as well as some generally broad-based interest in Matrix—the whole Matrix product family, actually.

Vivek Ranadivé

And also there is a bit of a backlash against some of the other players so people want to go with a neutral identity, whether it’s end user customers or OEM partners. So if you’re on the one hand competing with someone then you don’t want to be using their—you don’t want to be using their--OEM from them--and be dependent on them. So that’s helping us. And then the other factor is that people just don’t want to go to one vendor to get everything, so that’s helping us as well.

Derek Bingham - Goldman Sachs

Okay, got it. And then I wanted to get your thoughts on how much a potential slow down in packaged aps might impact your business. We got some softer results from Oracle yesterday.

Vivek Ranadivé

In some ways we’re kind of like DAC B-M for software, the B-M ware for software. You know just as with utilization you can leverage your hardware servers more. With our software you can actually get greater leverage from what you have. So, in some ways it makes us even more compelling in this environment.

Murray Rode

And I think one of the other things, Derek, you know, we’ve talked about quite a bit is how the application space, we argue, is generally evolving from monolithic applications to more of a kind of integration and coordination of components of applications. And we have seen a lot of our SOA business either being driven, or led, by BPM on the front end. And I think it’s possible that’s another facet of the same issue you’re talking about.

Vivek Ranadivé

Yes. So if you’re a customer you have a choice. You can either go do another big application, implementation, with long time lines and mixed results or you can just say, “Hey, I’ll take what I have and layer in SOA and BPM into that and leverage my existing investments.” And that’s what we’re seeing from customers.

Derek Bingham - Goldman Sachs

Okay. Got it. And then just one more, if I could. Any granulatary, meaning some verticals between for example, what you’re seeing from brokers relative to retail banking or commercial banking?

Vivek Ranadivé

Yes. Much of our strength was in retail and insurance. So on the investment banking side it had more to do with just messaging and high performance and low maintenance. But then we’re seeing terrific opportunities with the retail side and also with the insurance.

Derek Bingham - Goldman Sachs

Okay. Thanks very much.

Operator

(Operator Instructions) And from Jeffries & Company we’ll hear from Eric Slavinsky

Eric Slavinsky - Jeffries & Company

Thanks for taking my call. I want to first start with a kind of very broad macro question here. Are you guys observing any trends that, beyond say the financial services group, that may be different across Europe, U.S., and the Asia Pacific?

Vivek Ranadivé

Not really. If you’re asking, “Are you seeing greater strength in one place and less in the other?” No. This was a fairly typical quarter for us.

Eric Slavinsky - Jeffries & Company

Okay. And then secondly, on the sales cycles, relative to what you’ve traditionally seen here in Q1, were the sales cycles fairly normal across all deal sizes?

Murray Rode

They were actually. There was a similar crisis to that early on and I can’t say that we really felt a difference this Q1 versus past Q1s. As we’re pretty open about Q1, it’s certainly our toughest quarter seasonally, but we had a pretty good start to the quarter and a relatively strong finish to the quarter and deal cycles felt pretty similar to past Q1s.

Eric Slavinsky - Jeffries & Company

Okay, thanks. And a little detail here on Spotfire. Were the deals that you were able to sign in the quarter for Spotfire, were they multi-year deals that were paid up front or were they perpetual deals?

Murray Rode

They were virtually all the three-year term license deals.

Eric Slavinsky - Jeffries & Company

Okay, great. Thanks, guys.

Operator

Next up is Citi. We’ll hear from John Walsh.

John Walsh - Citi

Good afternoon. I know you touched upon it, as far the competitive environment, but may a little further as far as with Oracle and BEA set to get together, any feedback from customers and then any change in the competitive environment versus IBM and broadly held customers using the software consolidation?

Vivek Ranadivé

Yes, it’s good for us because customers want to go to a neutral party. There’s a bit of a backlash against the guys at a bank or the out companies. So, IBM continues to be our biggest and most threatening competitor. And interestingly enough we’re also getting flooded with resumes, as we mentioned earlier, where we’ve expanded our sales force and we’re continuing to do that. And not surprisingly Oracle and BEA were the places that we hired the most people from, followed by IBM and SAP. So, it’s been good for us so far.

John Walsh - Citi

And then Spotfire, any potential partnerships or resell arrangements that that product potentially has, that you’ve explored?

Vivek Ranadivé

Yes, we’re exploring some pretty exciting partnerships so just stay tuned on that.

John Walsh - Citi

But none have been consummated to date?

Vivek Ranadivé

Nothing that we’re able to announce. Murray, is that correct?

Murray Rode

That is correct.

John Walsh - Citi

Okay, great. Thanks.

Operator

And from [inaudible]

Unidentified

Hey, guys. With all the concern on the kind of fundamental economic landscape, if you look into your guidance—you know, reaffirming guidances is excellent but from a closure rate prospective, are you modeling kind of flat closure rates and you look into your pipeline for the coming quarter? Can you give us some sense of kind of your expectations around closure rates and how comfortable you are with the assumptions?

Murray Rode

We’re comfortable with our assumptions. We have taken a more kind of conservative view of things generally in terms of how we’ve looked at the year. Obviously if there is a global economic collapse—that we haven’t quite factored in, but we have tried to be pretty careful in our outlook and how we’ve shaped the guidance around that.

Vivek Ranadivé

And also if you look at the last couple of quarters, even within the troubled financial services sector, in Q4 we signed a large deal with Citibank, as they were facing troubles. And we saw the same type of activity in Q1 and so what we’re seeing is that there’s classes of problems that customers just absolutely need solved and almost independent of their financial circumstance. And so people are willing to spend on things that are a must-have. And for those kinds of things we are continuing to see success.

Unidentified

And then second question for you. You commented that given you guys are the remaining independent guy in the business, that it is helping you, given all the consolidation around you—you know BEA for quite a while said being independent of value, they were the only guy out there, and now they’re going to Oracle. Is there a real sustainable business model over time, as the gorillas just kind of add functionality to their product portfolios? And how do you see this playing out over a longer term kind of time frame?

Murray Rode

We absolutely think there is a sustainable model here and I think we’ve been—I would argue even more so than BEA ever did—described for years how we thought the market dynamics would play out. And I think there’s just no way that a conglomerate software provider can do the kinds of things we do. They’re just not going to have the same focus of innovation around infrastructure. So, I mean we very much think there is a sustainable model here.

Vivek Ranadivé

And that’s what customers want. I think there is a difference—BEA, you know, the obstacle had to run its course. And if you look at the companies that Oracle consolidated, they were companies in many ways that had run their course. And this is an area that is growing, it’s expanding and from the point of view of those bigger companies—Oracle, SAP, IBM, HP, Microsoft—it actually helped them to have to go be a strong independent company which can operate with all these entities. And so I think it’s a win-win proposition for the customer.

Unidentified

Right. Thanks a lot guys.

Operator

And we’ll hear from John DiFucci with Bear Stearns.

John DiFucci - Bear Stearns

Thank you. Just two questions, Murray. First, sales and marketing was higher than we had modeled even though we had modeled it to come up a little bit. It actually even as a percentage of revenue is higher than I think it’s been in any quarter since fiscal 2003. I’m just curious as to how—I know you’re expanding and you’ve talked about that and from the looks of the quarter it looks like things appear to be working for you, but just curious if you can give us a little bit of guidance, especially in that line item, going forward?

Murray Rode

I think as I mentioned in that comment on guidance, we will see a little bit of pickup in the sales expense in Q2—sales and marketing in Q2. That’s mostly driven by TUCON, our related marketing programs, and then some additional sales expense, both related to having a full quarter of the new hires as well as some anticipated additional sales related costs, commissions, travel and what not with the higher license. So, on the forward view, that’s the explanation.

In terms of just how it’s trended this quarter, again, it was pretty much as we expected and again, really driven by the focus on the quota heads.

John DiFucci - Bear Stearns

So is this line item going to be elevated relative to revenue going forward? Especially with increased revenue, it just seems sort of odd.

Murray Rode

Yes. Generally I don’t’ think, John, we’ve been particularly high on our sales and marketing expense relative to peer companies or even other kind of enterprise software companies roughly our size. So we will, longer term, see a little bit more, we think, sales and marketing expense as a percentage of revenue, but we do intend to kind of make that up in other ways. So, overall we’re still talking about margin expansion in the business.

John DiFucci - Bear Stearns

And that’s fair enough. Secondly, on the financial services vertical it looks like you guys had a good quarter there, too. Just curious, going forward, because we’ve heard from other companies and just from a lot of field work, that in the financial services vertical—and everyone’s aware, in my firm, and others of what’s happening in that vertical—that the application spending has really trailed off—at least that’s the way it looks—from several companies, but they continue to spend on infrastructure and they’re going to have to continue to run their business and incremental buys continues to make sense. At the same time, if things continue to be difficult or if they worsen then we might see—you know, you never know what you might see going forward—I’m sorry for the long-winded question, but I was just curious as to the tone out of your financial services team, do things look like they’re going to continue to be relatively stable going forward for you?

Murray Rode

Based on what we saw in Q4 and what we saw in Q1, we still feel pretty optimistic overall but we’re, John, I think we’re like everybody—we’re still a little bit cautious in our outlook about financial services. I think as we’ve seen the concentration of our business since the issue started has been much more retail focused and I think we expect that’s probably going to continue for awhile.

Vivek Ranadivé

Yeah, John, the irony is I got a message from your IT department today saying that they wanted to make sure we would continue supporting them because our software and what was done it was viewed by your purchasers as a key value head in the purchase price. And so we’re seeing companies place high value on this.

John DiFucci - Bear Stearns

Okay. Thank you very much.

Operator

And from Merrill Lynch we’ll hear from Alan Cooke.

Alan Cooke - Merrill Lynch

Great, thank you very much. Vivek and Murray, in terms of your license revenue for the quarter, it looks like it was little bit below the low end of your guidance. Can you give us any color on why that was?

Murray Rode

Yes, it was really just a few hundred thousand ultimately below the low end of the range and you know for us, Alan, given kind of the deal sizes that we tend to operate with, one deal can swing you pretty substantially within the range. So I think, generally speaking, it was not outside of the range that we expected. One or two deals that could have fallen in the quarter that are now part of the Q2 pipeline, and that would have changed the picture.

Vivek Ranadivé

And I think we’ve also said all along that we feel, if you look at it on an annual basis, we had hit capacity with the sales people we had. And in order for that core infrastructure business to grow we needed to hire more salespeople. Which we’ve done now and we feel that will start paying off towards the end of the year.

Alan Cooke - Merrill Lynch

Okay, thanks. And in terms of that hiring, Vivek, do you expect to complete the hiring to 190 by the end of Q2?

Vivek Ranadivé

Well, certainly by the end of the year. You know, we’re excited with the 18 hires we’ve made so far and the sooner the better, but Murray, you probably have more clarity on when.

Murray Rode

As we were actually saying, I don’t think we want to hit the 190 right away in Q2. We feel like we’ve got a sufficiently good start, that it gives us a little bit more flexibility. If we hit that number sooner rather than later, that’s fine, but the real objective is just to be 190 or more by the end of the year.

Alan Cooke - Merrill Lynch

Okay, and in terms of currency [inaudible], how did it benefit you posting your license revenues and your total revenues?

Murray Rode

You know, it had very little effect this quarter for us. Just the way the currency movements worked out relative to the business we had and what we were doing, which currencies we had concentrations in the quarter, we really had really virtually no impact.

Alan Cooke - Merrill Lynch

Thank you very much.

Operator

And from Ferris, Baker Watts we will hear from Raghavan Sarathy.

Raghavan Sarathy - Ferris, Baker Watts

Good afternoon, and thanks for taking my questions. Two quick bookkeeping questions. What led the [inaudible] license in contributions in the quarter.

Murray Rode

I actually answered that previously where we said it was over half of the business authorization category.

Raghavan Sarathy - Ferris, Baker Watts

That’s the license revenues?

Murray Rode

Yes.

Raghavan Sarathy - Ferris, Baker Watts

Okay. And then, how many of the year customers are from Spotfire?

Murray Rode

About a dozen, I believe.

Raghavan Sarathy - Ferris, Baker Watts

Thank you.

Operator

And now we’ll hear from Pacific West Securities.

Pacific West Securities

Hi, guys. Couple of things. One, on Spotfire, can you talk a little bit about the synergies between Spotfire and your core products? Have you seen that increase? And then in terms of integration between key products, what kind of stuff have your added and what kind of stuff you’re planning to add.

Murray Rode

We have started to see some synergies in terms of deal activity and that’s a fairly big focus for us this year is to explore those cross-sale and synergistic sales more aggressively. In terms of the products being used together or integrated more as technology, that is, again, another initiative this year for 2008. And the points of convergence that we’ll start with—ultimately they’re actually quite a few—but where we’ll start is really between Spotfire and what we’re doing with business events. And then secondarily where Spotfire fits into some of the analytics around BPM.

Pacific West Securities

Just ball park, what are the time frames for that?

Murray Rode

Well, we will, over the course of this year, be doing some of this, particularly as it relates to business events, so later in the year.

Pacific West Securities

And then, Vivek, you had talked about acquisitions as a focus area. Is there any color you can give us on markets or areas of functionality that you’re focused on?

Vivek Ranadivé

Not really. We’re playing it pretty close to the chest. We see some interesting opportunities, but . . . .

Pacific West Securities

Okay. And then, Murray, can you just give me an update on the buy-back; how much is left outstanding?

Murray Rode

$70 million left in the currently authorized program.

Pacific West Securities

Thank you very much.

Murray Rode

All right, we’ll now conclude this call. Thank you all for joining us and we hope to see you at our user conference in April, or along the road. Thank you, and goodbye everyone.

Operator

Thank you for joining us. We’ll now conclude TIBCO’s Quarter 1 2008 Earnings Call.

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Source: TIBCO Software, Inc. F1Q08 (Qtr End 02/29/08) Earnings Call Transcript
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