23 October 2017
Find out more

Wagner patent expiry to hit eSpeed earnings

03 May 2007  |  4626 views  |  0 cash

US electronic bond trading network eSpeed is forecasting a dip in revenue and operating income for the remainder of 2007 following the expiration of the Wagner patent in February of this year.

ESpeed recognised $3.1 million in revenue and $1.5 million in non-GAAP net operating income related to the patent in the first quarter of 2007.

The company has extracted tens of millions of dollars from US futures and options exchanges through its rigorous enforcement of the patent in the law courts. The patent, acquired by eSpeed for $3 million in 2001, described a method of matching bids and offers in electronic futures trading.

In its first quarter results statement released late yesterday, the company reported revenues three per cent lower than in the year-ago period. GAAP net income of $0.9 million stood at $0.02 per diluted share in the first quarter of 2007 vs. $0.04 per diluted share in the first quarter of 2006.

eSpeed's non-GAAP operating revenue increased six per cent and the company's non-GAAP net operating income per diluted share increased to $2 million or $0.04 in the first quarter of 2007 from $0.03 in the prior year's first quarter.

The difference between non-GAAP net operating income and GAAP net income for the quarter occurred primarily due to $0.8 million in patent litigation costs and $0.4 million in losses from the firm's Equities Direct Access business, which is set to become a separate company called Aqua in the second quarter and in which eSpeed will have an equity stake.

The company, which recently rebuffed an offer from interdealer broker Tullett Prebon, is currently under siege from hedge funds demanding a seperation of its business from that of parent company Cantor Fitzgerald.

Howard Lutnick, eSpeed's chairman and CEO, sought to emphasise the positives in the first quarter trading statement.

"eSpeed's fundamental strength was underscored by the year-over-year gains in our U.S. treasury business and by increased screen-assisted revenue as additional BGC desks entered our hybrid pipeline," he says. "In addition, eSpeed's futures products made solid gains. We remain optimistic about our growth prospects for 2008 and beyond based on strong expected returns on the investments the company has made in our portfolio of new products."

Fully electronic revenues were $17.9 million in the first quarter of 2007 compared with $16.7 million for the first quarter of 2006. Revenues from Software Solutions were $12.3 million versus $11.3 million in the year ago period. Voice-assisted and screen-assisted revenues totaled $8.7 million in Q1 2007 compared with $8.7 million in the equivalent period.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Cantor rejects eSpeed bid from Tullett Prebon

Cantor rejects eSpeed bid from Tullett Prebon

18 April 2007  |  8648 views  |  0 comments
Aqua adds John Silvestri to senior management team

Aqua adds John Silvestri to senior management team

10 April 2007  |  5578 views  |  0 comments
Hedge funds circle eSpeed

Hedge funds circle eSpeed

30 March 2007  |  4441 views  |  0 comments
Espeed loses OMX patent appeal

Espeed loses OMX patent appeal

27 March 2007  |  4741 views  |  0 comments
Chapman Capital piles pressure on eSpeed following patent ruling

Chapman Capital piles pressure on eSpeed following patent ruling

22 March 2007  |  4886 views  |  0 comments
Chapman Capital demands eSpeed shake-up

Chapman Capital demands eSpeed shake-up

15 March 2007  |  4285 views  |  0 comments
Aqua names Brian Weston CTO

Aqua names Brian Weston CTO

06 March 2007  |  5876 views  |  0 comments
Espeed names Yevette Tierney CIO

Espeed names Yevette Tierney CIO

21 February 2007  |  7786 views  |  0 comments
Fishkind joins Foley at Aqua

Fishkind joins Foley at Aqua

30 January 2007  |  4810 views  |  0 comments
Espeed claims victory in TT patent battle

Espeed claims victory in TT patent battle

07 November 2006  |  9485 views  |  0 comments
ESpeed plunges into the red

ESpeed plunges into the red

05 August 2005  |  5170 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
Register nowvisit www.fivedegrees.nlvisit www.vasco.com

Top topics

Most viewed Most shared
Mastercard to roll out blockchain APIMastercard to roll out blockchain API
16817 views comments | 20 tweets | 34 linkedin
HSBC partners Bud for open banking trialHSBC partners Bud for open banking trial
14183 views comments | 22 tweets | 30 linkedin
Sibos 2017: API or the highwaySibos 2017: API or the highway
10426 views comments | 12 tweets | 23 linkedin
satelliteGates Foundation backs Ripple collaboratio...
10100 views comments | 13 tweets | 10 linkedin

Featured job

Competitive
New York, NY - USA (some flexibility on location)

Find your next job