NetSuite Recruits New Partners, Reports 30 Percent First-Quarter Growth
NetSuite enlisted four new channel partners to its NetSuite Solution Provider Program, the company said Monday. And if CEO Zach Nelson has his way, the partner recruitment will continue.
"We always feel that we're underdistributed," Nelson said Monday. NetSuite's target customers are the "Fortune 5 Million," and the channel is a critical part of the effort to reach them, he said. "We love the channel," he said during a conference call with financial analysts to discuss the company's fiscal first-quarter financial results.
"Some people talk about our [business] model as having inherent channel conflict," Nelson said. "We've never really had channel conflict because there's so much opportunity, so many different skill sets required based on the industry that's using NetSuite -- the type of deployment they're doing. We're really happy about the partners we have. We have some partners that have been with us since day one and are now fairly large resellers and implementers.
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"But we feel we're underdistributed. The good news is the channel is beginning to come to us," he said, pointing to the most recent recruits. Some solution providers that work with Microsoft, Sage Software and other vendors "see the writing on the wall and need a cloud-native solution," Nelson said.
The new partners are Allunna, CuriousRubik, FMT Consultants and One Vision LLC. The move gives the solution providers a presence in the cloud ERP and cloud business management arena, NetSuite said.
FMT Consultants and One Vision will be adding NetSuite to their existing Microsoft Dynamics GP practices. "We've seen a significant shift in the marketplace from on-premise to cloud-based solutions, and NetSuite, with its integrated CRM, ERP, and ecommerce platform and strong partner resources and channel growth, provided a perfect opportunity to be a part of that," said FMT Consultants' CEO Eric Casazza in a statement.
Allunna and CuriousRubik already work with NetSuite's cloud applications, but are now expanding those practices and joining the NetSuite partner program.
NetSuite reported revenue of $123.0 million for the first fiscal quarter ended March 31, up 34 percent from $91.6 million in the same quarter one year ago. That included a 34 percent gain in subscription and support revenue to $99.4 million, and a 33 percent increase in revenue from professional services to $23.6 million.
Cash flows from operations in the first quarter were $19.1 million, up from $14.7 million in the same period one year earlier. NetSuite also recorded its largest sales contract during the quarter, Nelson said during the earnings call, but he declined to provide details or identify the customer.
The company increased its sales forecast for all of fiscal 2014 to a range of $540 million to $545 million.
"We posted record revenue, record deferred revenue, record cash collections, record operating cash flow, record average selling prices, record OneWorld average selling prices, record SuiteCommerce average selling prices, the largest contract in the company's history, 19 consecutive quarters of revenue growth, seven quarters of 30 percent or greater revenue growth, we raised our outlook for fiscal 2014 on the revenue front, and today we have more employees than we've ever had in the company's history," Nelson said, summing up the company's financial state.
One other thing that continued to grow, however, was the net loss on NetSuite's bottom line. For the first quarter, the company's net loss reached $22.2 million, compared to the $13.0 million net loss recorded in the same period one year before.
PUBLISHED APRIL 28, 2014