Novell Reports Financial Results for Third Fiscal Quarter 2007

Novell, Inc. (NASDAQ:NOVL) today announced financial results for its third fiscal quarter ended July 31, 2007. For the quarter, Novell reported net revenue of $243 million, compared to net revenue of $236 million for the third fiscal quarter 2006. The loss from operations for the third fiscal quarter 2007 was $10 million, compared to a loss from operations of $40 million for the third fiscal quarter 2006. The loss available to common stockholders from continuing operations in the third fiscal quarter 2007 was $3 million, or $0.01 loss per common share. This compares to a loss available to common stockholders from continuing operations of $17 million, or $0.05 loss per common share, for the third fiscal quarter 2006. Foreign currency exchange rates favorably impacted total revenue by approximately $4 million and negatively impacted the loss from operations by $1 million year-over-year.

On a non-GAAP basis, adjusted income from operations for the third fiscal quarter 2007 was $12 million. This compares to non-GAAP adjusted income from operations of $6 million in the year-ago quarter. Non-GAAP adjusted income available to common stockholders from continuing operations for the third fiscal quarter 2007 was $16 million, or $0.05 per adjusted diluted common share. This compares to non-GAAP adjusted income available to common stockholders from continuing operations of $24 million, or $0.06 per adjusted diluted common share, for the third fiscal quarter 2006.

For the third fiscal quarter 2007, Novell reported $22 million of revenue from Open Platform Solutions of which $21 million was from Linux* Platform Products, up 77 percent year-over-year. Linux Platform Products invoicing was $38 million, up 95 percent year-over-year. Revenue from Identity and Security Management was $30 million of which Identity and Access Management was $27 million, up 2 percent year-over-year. Revenue from Systems and Resource Management was $35 million, up 4 percent year-over-year. Revenue from our Workgroup business unit declined 2 percent from the year-ago period to $83 million.

“We are encouraged by our Linux performance and the market’s continued enthusiasm for our desktop to datacenter strategy. In addition, we are pleased with our operating margin expansion and progress on our strategic initiatives,” said Ron Hovsepian, president and CEO of Novell.

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