From: Reuters
Published May 29, 2008 04:46 PM

Novell posts 2nd-qtr profit; Linux sales rise

BOSTON (Reuters) - Novell Inc <NOVL.O> turned a quarterly profit, versus a year-earlier loss, on lower expenses and a jump in sales of its Linux business software, it reported on Thursday.

Fiscal second-quarter net income came to $5.9 million, or 2 cents a share, compared with a year-earlier loss of $2.9 million, or 1 cent a share.

Excluding items, profit from continuing operations was 6 cents a share, ahead of the Wall Street outlook of 5 cents.

Revenue rose to $236 million from $232 million. Operating expenses fell to $173 million from $180 million.

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The company's shares rose 1 percent to $6.80 in extended trade after closing up 2.1 percent to $6.71 on Nasdaq.

Novell is the world's second-largest seller of Linux software after Red Hat Inc <RHT.N>.

Sales of Linux software and other programs in Novell's open platforms group rose 31 percent to $30 million.

The increase helped offset a 1 percent drop in sales at its workgroup networking software division to $92 million.

The company reiterated its previous forecast for full-year net revenue of $940 million to $970 million.

It also said it still expects non-GAAP operating margin between 7 percent and 9 percent, excluding acquisition-related items.

(Reporting by Jim Finkle; editing by Jeffrey Benkoe)

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