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| Sustained Success |
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| To study sustained success in the software industry, Cape Horn Strategies first conducts research on an annual basis to determine who are the Sustained Success Honor Roll members--see below-- and then investigates why these companies have been successful. |
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| We have published our findings as the "Business Strategy" column in Software Business magazine. |
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| 2007 Sustained Success Honor Roll |
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| Of all the software companies on the U. S. stock exchanges--NYSE, AMEX, NASDAQ--only
23 out of 482
in 2006 managed to achieve a record of five consecutive years or more of profitable
growth.
This group on average grew at 14%. If you omit Microsoft from this
list, the other 22 companies had a growth rate
of 20%.
This year some changes to the list reflected on-going changes in our
industry.
- Kronos, who up to 2005 , had 18 years of continuous growth and
profitability went private. And Docucorp went private as well.
- Mercury Interactive was acquired by HP.
- And the largest growth companies on the list tended to be the
those who provide outsourcing services: Cognizant, Mantech and SRA
International.
- And reflecting the focus on growth and profitability, away from
the excess of the dot.com era, the most new companies joined the
list, six.
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Company |
Revenue
(Million) |
Consecutive
Years Of Profitable Growth |
2006
Revenue
Growth % |
| Microsoft |
$44,282.0 |
26 |
11% |
| Manhattan
Associates |
$288.9 |
17 |
17% |
| Business
Objects |
$1,253.8 |
14 |
14% |
| THQ, Inc |
$806.6 |
12 |
7% |
| Cognizant |
$1424.3 |
12 |
60% |
| OPNET |
$76.1 |
12 |
19% |
| ANSYS |
$263.6 |
11 |
67% |
| Trend
Micro |
$718.7 |
10 |
12% |
| Infosys |
$2,152 |
9 |
35% |
| SRA
International |
$1,179.3 |
9 |
34% |
| EPIQ
Systems |
$224.2 |
9 |
71% |
| Quality
Systems |
$119.3 |
8 |
34% |
| ILOG |
$133.6 |
7 |
7% |
| Mantech |
$1,137.2 |
7 |
16% |
| Activision |
$,1468.0 |
6 |
5% |
| Retailix |
$203.7 |
6 |
7% |
| Websense |
$178.8 |
6 |
20% |
| BEA |
1,199.8 |
5 |
11% |
| Ciber |
$995.8 |
5 |
4% |
| Intuit |
$2,342 |
5 |
15% |
| Micro Sys |
$679.0 |
5 |
14% |
| Ness |
$474.3 |
5 |
23% |
| Quest |
$561.6 |
5 |
18% |
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| 2006 Sustained Success Honor Roll |
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| Of all the software
companies on the U. S. stock exchanges--NYSE, AMEX, NASDAQ--only 20
out of 503 in 2005 managed to achieve a record of five consecutive
years or more of profitable growth.
As a group, reflecting their over-all success,
the Honor Roll members significantly outperform the industry averages.
While the software industry as a whole had little revenue growth at
4%, this group on average grew at 8%. If you omit Microsoft from this
list, the other 19 companies had an unusually high average growth rate
of 31%.
And while the industry’s net revenue grew 20%, net revenue for the
Honor Roll group grew at a rate more than double that of 43%.
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Company |
Revenue
(Million) |
Consecutive
Years Of Profitable Growth |
2005
Revenue
Growth % |
| Microsoft |
$39,786.0 |
25 |
8% |
| Kronos |
$518.7 |
18 |
15% |
| Manhattan
Associates |
$246.4 |
16 |
14% |
| Business
Objects |
$1,077.2 |
13 |
19% |
| THQ, Inc |
$756.7 |
11 |
18% |
| Cognizant |
$885.8 |
11 |
51% |
| OPNET |
$64.2 |
11 |
12% |
| ANSYS |
$158.0 |
10 |
17% |
| Trend
Micro |
$641.7 |
9 |
11% |
| Infosys |
$1,592 |
8 |
51% |
| SRA
International |
$881.8 |
8 |
43% |
| EPIQ
Systems |
$130.8 |
8 |
5% |
| Open Text |
$414.8 |
7 |
42% |
| Quality
Systems |
$89.0 |
7 |
25% |
| ILOG |
$125.3 |
6 |
21% |
| Mantech |
$980.3 |
6 |
16% |
| Activision |
$,1405.9 |
5 |
48% |
| Docucorp |
$79.2 |
5 |
3% |
| Retailix |
$191.3 |
5 |
54% |
| Websense |
$148.6 |
5 |
33% |
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| 2005 Sustained Success Honor Roll |
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Of all the software companies on the U. S. stock exchanges--NYSE, AMEX, NASDAQ--only 17 out of 552
in 2004 managed to achieve a record of five consecutive years or more of profitable growth. |
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This year no company dropped from the Honor Roll, a postive indication of better health in our industry
while two new companies were added, ILOG and Mantech. |
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For the Honor Roll members growth was outstanding. Not including Microsoft the group had an annual growth
rate of 34%, growing from $5.5 billion to $7.4 billion. |
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Company |
Revenue
(Million) |
Consecutive
Years Of Profitable Growth |
2004
Revenue
Growth % |
| Microsoft |
$36,835.0 |
24 |
14% |
| Kronos |
$450.7 |
17 |
13% |
| Manhattan
Associates |
$214.9 |
15 |
9% |
| Business
Objects |
$925.6 |
12 |
65% |
| THQ, Inc |
$640.8 |
10 |
10% |
| Cognizant |
$586.7 |
10 |
59% |
| OPNET |
$56.5 |
10 |
22% |
| Mercury
Interactive |
$685.5 |
9 |
35% |
| ANSYS |
$134.5 |
9 |
19% |
| Trend
Micro |
$595.5 |
8 |
36% |
| Infosys |
$1,062.6 |
7 |
41% |
| SRA
International |
$615.8 |
7 |
37% |
| EPIQ
Systems |
$125.4 |
7 |
85% |
| Open Text |
$291.1 |
6 |
64% |
| Quality
Systems |
$70.9 |
6 |
29% |
| ILOG |
$102.8 |
5 |
11% |
| Mantech |
$842.4 |
5 |
20% |
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| 2004 Sustained Success Honor Roll |
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Of all the software companies on the U. S. stock exchanges--NYSE, AMEX, NASDAQ--only 15 out of
573 in 2003 managed to achieve a record of five consecutive years or more of profitable growth. |
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The 2004 Honor Roll saw one mega-company drop from the list while it added two small ones.
While still maintaining excellent profitability, SAP is no longer on the honor roll because it dropped
in revenue from 2002 to 2003, going from $9.4 billion in 2002 to $8.9 billion in 2003. And Quality Systems
and Open Text, in 2003, completed their fifth year of profitability and growth. |
Out of the largest 223 public product software companies, only the nine--those listed below--have
records where for the past five years, or more, they have had back to back years of growth and profitability. |
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Company |
Revenue
(Million) |
Consecutive
Years of
Profitable Growth |
| Microsoft |
$32,187.0 |
23 |
| Kronos |
$397.4 |
15 |
| Manhattan
Associates |
$196.8 |
14 |
| Business
Objects |
$560.8 |
11 |
| THQ, Inc |
$584.5 |
9 |
| Cognizant |
$368.2 |
9 |
| OPNET |
$46.4 |
9 |
| Mercury
Interactive |
$506.5 |
8 |
| ANSYS |
$113.5 |
8 |
| Trend
Micro |
$437.0 |
7 |
| Infosys |
$753.8 |
6 |
| SRA
International |
$450.4 |
6 |
| EPIQ
Systems |
$67.9 |
6 |
| Open Text |
$177.7 |
5 |
| Quality
Systems |
$54.8 |
5 |
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| Past Honor Roll Members |
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These companies had consecutive years of year-to-year growth and profitability for the years shown.
(This is an incomplete list but represents what we have discovered in our research so far) |
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Company |
#
Of Years |
From |
To |
| SAP |
15 |
1988 |
2002 |
| MapInfo |
13 |
1987 |
2001 |
| BMC |
13 |
1988 |
2000 |
| Oracle |
10 |
1992 |
2001 |
| Serena
Software |
8 |
1994 |
2001 |
| Cognos |
8 |
1994 |
2001 |
| Checkpoint |
8 |
1994 |
2001 |
| OnTrack |
8 |
1993 |
2000 |
| Citrix |
8 |
1994 |
2001 |
| MRO
Software |
7 |
1994 |
2000 |
| RSA
Security |
7 |
1994 |
2000 |
| Siebel |
6 |
1995 |
2001 |
| Adobe |
5 |
1994 |
1997 |
| Amdocs |
5 |
1997 |
2001 |
| Advent
Software |
5 |
1997 |
2001 |
| Pegasystems |
5 |
1993 |
1997 |
| Symantec |
5 |
1997 |
2001 |
| American
Education |
5 |
1996 |
2000 |
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