Nimsoft’s Revenue Booms
Still skeptical about the promise and payoff of managed services? Maybe you should pay a visit to Nimsoft. The managed service platform provider says 3Q 2007 sales grew 130 percent compared to 3Q 2006. Nimsoft says it also achieved EBITDA profitability, though The VAR Guy doesn’t pay that much attention to that financial metric.
EBITDA (earnings before interest, taxes, depreciation and amortization) can sometimes be a misleading statistic. During the dot-com boom, companies such as Exodus Communications pointed to EBITDA to brag about their growing success. Heck, even Ziff Davis — the former media giant — spent recent years bragging about EBITDA while bond holders worried about Ziff’s enormous debt load. Exodus, Ziff and plenty of other companies collapsed despite their EBITDA achievements.
The VAR Guy certainly isn’t suggesting Nimsoft will suffer the same fate. In fact, things look pretty darn bright at the company. Year to date, Nimsoft has increased its revenue growth by more than 80-percent over the same period for 2006 while growing its subscription business by 93 percent. Not too shabby.
Nice article and indeed, business is booming. Main market issue is that HP et al are so messed up; they have lots of overlapping products and have added so much complexity for customers. They are going for the big $10m+ contracts and forgetting the rest of the market. Sometimes customers just want something that works (now there’s a novel concept).
Take your point on EBITDA but no funny accounting going on here! We were actually not budgetted to be profitable this quarter, but revenues were ahead of schedule and expenses were slightly under.
Gary Read
CEO
Nimsoft
PS Nice blog by the way
Thanks for the good Read, Gary. And sorry for that terrible pun. Please keep The VAR Guy posted on Nimsoft’s progress. And maybe in the future, The VAR Guy will realize NimSoft’s name has a lower-case s. He apologizes for that typo.
The VAR Guy