Irishman’s software firm reports US$13.9m profit


21 Oct 2004

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A software company started over a decade ago by a 22-year-old Irishman with a £2,000 sterling loan today reported third-quarter revenues of US$14.5m. Autonomy Corporation reported that gross profits for the quarter were US$13.8m, up 11.2pc year on year.

Looking at the first nine months of 2004, revenues totaled US$46.1m, up 21.6pc from US$37.9m reported last year.

Since starting Autonomy Corporation, Dr Michael Lynch has witnessed his company achieve a market capitalisation of £8bn sterling and has seen revenues and earnings increase steadily over the past 17 consecutive quarters.

When aged 22, Lynch obtained a £2,000 sterling loan to start his first company Neurodynamics. Now a global success story, Autonomy has succeeded in being profitable and cash generative throughout the market downturn. With dual headquarters in San Francisco and Cambridge, the company at one point soared to a value of £8bn sterling and today employs more than 200 people.

The company’s software has been used by some of the world’s biggest corporations and more recently has been used by the US Government in the fight against terrorism. Up to 200,000 employees across various agencies responsible for homeland security functions in the US will use Autonomy technology to more efficiently analyse, assess and share information from multiple repositories related to suspected terrorist groups.

During the Q3, Autonomy secured lucrative contracts with IBM, Boeing, Morgan Stanley, Credit Mutuel as well as various US Federal Government agencies, such as the Federal Election Committee, National Geospatial and the US Army.

Commenting on the quarter, Lynch said: “We’ve achieved these results despite usual Q3 seasonal weakness. Of particular note, the first nine months have seen us produce record revenues and strong growth in core earnings. Once again we’ve seen success across all vertical markets, with new and repeat customers in sectors such as finance, telecommunications, technology, manufacturing, entertainment, traditional and electronic commerce, regulatory, government, intelligence and homeland security.

“During Q3 Autonomy invested significantly in new technology resulting in increased research and development [R&D] spend. With significant investment in sales and marketing in the first half of 2004 and increased R&D spend, we remain confident in our long-term outlook,” Dr Lynch added.

By John Kennedy