On May 11th, Phoenix Technologies LTD., a provider of Core System Software (CSS) and applications software, reported fiscal 2006 2nd quarter revenue of $23.1 million. This compares to $27 million in the year ago period, and $18 million in the prior quarter. On a Gaap basis net loss was $3.2 million or 13 cents per share which compares to a Gaap loss of 32 cents per share in the prior quarter and net income of 12 cents per share in the year ago period. On a non-Gaap basis PTEC reported a net loss of $1.8 million or 7 cents per share. Gross margins were 79%.
     Revenue from new businesses accounted for 33% of revenue, while Core System Software related revenue accounted for the remainder. The CEO said that growth in it's applications business was affected by product delays that have since been corrected. During the 2nd fiscal quarter PTEC's top 3 customers accounted for 23%, 16%, and 11% of total revenue. 93% of revenue was derived from outside North America. The Asia region accounted for 90% of revenue. Research and development represented 26% of revenue during the quarter.
     For the 3rd fiscal quarter of 2006 the company expects to report revenue of $24.5 - $26.5 million which would be up from the year ago period. Excluding stock option expense PTEC expects to report earnings of between 0 and 6 cents per share. For the full fiscal year the company expects revenue of $100 - $105 million.
     PTEC has cash and short term investments worth $76.4 million or $3.04 per share. Book value is $2.88 per share and the company carries no debt. At the current level the stock has a price-to-sales ratio of 1.5 and a price-to-book ratio of 1.9.
     In the chart below you can see that the stock has just come off a low which has provided support several times during the past 3 years.