Earnings Preview: Sybase

Sybase (SY) is expected to report Q2 earnings today, July 23, after market close, with a conference call scheduled for 5:00 pm ET.

Guidance

The consensus estimate is 43c for EPS and $262.54M for revenue, according to First Call. The company provided Q2 guidance on their last earnings call of 40c to 45c for EPS and revenue of $255M to $265M.

Analyst Views

On the whole, Keybanc expects Q2 performance to be strong and for revenue and EPS to come in ahead of consensus, based on strength in the database and messaging businesses. ASE site license renewals would be the likely driver of strong database performance, while growth in messaging volumes would drive messaging revenue, says Keybanc. They believe if any weakness is evident it would be in the mobility segment, due to quarter-over-quarter choppiness in OEM deals or longer end-customer decision cycles. Looking forward, Keybanc expects Sybase to raise full-year guidance. Although the recent acquisition of a small MMS Hubbing business from Cable & Wireless could complicate guidance, management is expected to offer sufficient transparency to confirm improvement to the 2008 outlook on an organic basis. Company guidance for FY08 stands at $1.94 to $1.99 and revenue of $1.07B and $1.09B.