E.piphany's moment of clarity reveals $2 billion loss

Factoring in multiple expenses, CRM vendor E.piphany recorded a loss of $1.98 billion for the quarter ending Sept. 30.

The San Mateo, Calif.-based company attributed the loss to amortization of one-time, goodwill charges, which involved the write-down of depreciated, acquired assets, as per new accounting rules.

E.piphany's financial performance was impacted by declining stock values regarding several companies it acquired and has since absorbed, company officials said. The companies include Octane Software, which offered call center technology; Rightpoint Software, a maker of personalization technology; collaboration company iLeverage; and direct mail vendor eClass.

Also impacting the bottom line were $32.4 million charges related to restructuring, including facilities consolidation and employee severance. Including the goodwill and other non-recurring charges, the net loss for the quarter was $1.98 billion.

"What I can tell you is at the end of 2000, we were carrying $2.5 billion of goodwill [assets]. Now, we're carrying $115 million," said Todd Friedman, vice president of investor relations at E.piphany.

For the quarter, E.piphany reported revenues of $28.5 million, a 27 percent drop from revenues of $39.1 million recorded during the same time period last year. Excluding the one-time charges, the net loss for the quarter was $15 million, or 22 cents per share.

The company did beat a prior Wall Street estimate of a 24-cents-per-share loss, E.piphany officials said. E.piphany hopes to break even, with revenues in the $35 million to $39 million range, in the second half of 2002.

In a prepared statement, company President/CEO Roger Siboni noted the company is facing challenging economic times, but has acquired new customers such as Epson, GE Plastics, and Johnson & Johnson.

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