Magic Software Scores Another Quarterly Revenue Success
November 18, 2013 Dan Burger
The revenue trajectory for IBM i development tool maker Magic Software Enterprises continues to soar posting a third quarter revenue gain of 9 percent in year-to-year comparisons and topping its previous quarterly revenue by $1.2 million. Revenues for the first nine months of 2013 reached $103.8 million.
In the third quarter of 2013, which ended September 30, Magic Software’s revenues grew to $35.6 million compared to $32.6 million for the same quarter in 2012. The Q3 revenue incline topped Q2 revenue by 6 percent. So far in 2013 the quarterly revenue ramp has climbed from $33.4 million to $34.8 million to $35.6 million.
Revenues for the first nine months of 2013 reached $103.8 million compared to $90.7 million in the same period last year. That’s a nifty 14 percent gain in altitude.
Magic’s CEO Guy Bernstein attributed the financial bounty to “great interest in the recent enhancements we have made to enrich our enterprise mobility, integration and services offerings.” Bernstein was not specific in his description, claiming his company’s growth included “all areas of our business and all regions.”
The Israeli-based technology company relies primarily on two products–the uniPaaS rich Internet application (RIA) framework and the iBolt integration tool–and the attendant professional services. In October, the company agreed to purchase Allstates Technical Services, for $10 million. Allstates is a is a US-based provider of IT consulting and staffing as well as consulting and staffing for the engineering and telecom industries. The acquisition is expected to be finalized before the end of November.
The acquisition broadens Magic’s presence in the United States while adding Fortune 500 companies to its customer base. The acquisition will be managed by Magic’s Dallas, Texas-based Fusion Solutions subsidiary, an IT staffing services company.
Magic has other consulting and staffing services companies within its organization, and they have made considerable contributions to the rising revenue stream. According to an article in Seeking Alpha by William Garrison, Magic’s consulting services revenue grew at nearly a 50 percent annualized rate from 2009 through 2012, with revenue increasing from $24.3 million in 2009 to $80.3 million in 2012. Garrison also reported approximately two-thirds of Magic’s 1,000 employees work within the technical support and consulting division.
Last month Magic released a mobile device management toolkit that assists IBM midrange shops in the provisioning, support, security, and monitoring of mobile devices. The software supports iOS, Android, and Windows platforms, and enables administrators to accomplish management tasks through a Web-based interface. In an IT Jungle report, a Magic Software executive stated 20 to 30 percent of Magic’s current customer engagements are spurred by a need for mobile solutions and that number was expected to increase to at least 60 percent next year.