Kana Communications, Inc. (Nasdaq: KANA) was down $2.38 to $7.06 early Thursday, after the company reported Wednesday a wider loss for the fourth quarter ended December 31st.
Analysts at several firms reportedly downgraded Kana shares following the news, with Credit Suisse First Boston and Williams Capital cutting their ratings to hold from buy, Goldman Sachs cutting its rating to market outperform from recommended, and US Bancorp Piper Jaffray cutting its recommendation to buy from strong buy.
Kana lost US$33.2 million, or 37 cents per share, before extraordinary items, compared with a loss of $12.0 million, or 23 cents per share, a year earlier.
Nonetheless, Kana said it expects 2001 growth to be “greater than 50 percent” over 2000, with positive cash flow in the third quarter and a profit in the fourth quarter.
Kana said the market for so-called “enterprise relationship management” software — which includes managing e-mail and other communications — is likely to remain strong despite a decline in overall spending on information technology.
A Redwood City, California-based maker of e-commerce and other business software, Kana said it posted a net loss of $2.4 billion, or $27.21 per share, including a $2.1 billion charge for the acquisition of Silknet Software, Inc. and a $2.0 million charge to cover a patent settlement.
Kana said revenue for the quarter soared to $42.4 million from $6.5 million in the same period a year earlier. Chief executive officer Jay Wood said the revenue gain came thanks to license agreements with “world-leading” companies including Cigna, Comcast, AT&T and Sprint.
“Also contributing to the record quarter were sales of new products into existing accounts, business won jointly through our IBM and Accenture relationships, and our B2B business,” Wood said.
Kana also named David Fowler president and Nigel Donovan chief operating officer. Fowler and Donovan both joined the company from Silknet. The company’s previous chief executive, Michael McCloskey, resigned earlier this month because of a medical condition.