Security technology firm ActivCard has more than doubled its net loss for the second quarter after being forced to swallow additional charges and revise revenue forecasts for the 4Tress product line, acquired earlier this year from UK banking technology vendor Aspace.
Revenue for the quarter ended 31 March, 2005 was $9.2 million - in line with prior guidance - compared to $7.3 million for the year-ago quarter, but down 21% sequentially. The company chalked up net losses of $25.4 million, compared to $9.1 million in Q2 2004.
ActivCard says the Aspace unit, which sells multi-channel single sign-on technology to the banking market, failed to meet one of its earn-out contingencies resulting in the company revising its near term revenue forecast for the 4Tress product line. Based on the revised revenue forecast, ActivCard has recorded an impairment of acquired technology of $3.6 million, included in cost of revenue, an impairment of goodwill of $9.4 million, and write-down of acquired intangible assets of $2.4 million.
The firm says it recorded its first sale of the 4Tress product line this quarter through a reseller agreement with IBM.
ActiCard has moved to freshen up sales and marketing, sacking senior vice president Frank Bishop and appointing CEO Ben Barnes as acting head of worldwide sales. Bishop's departure follows last month's announcement that the firm intends to cut 10% of its workforce in an effort to reduce costs.