Tech Vendors Report Good 3rd Quarter; Job Boards Down

Third quarter financial reports are coming in for the publicly held recruiting industry vendors and the results show that the world economic condition is beginning to have an effect.

HR technology providers Taleo (profile; site), Kenexa (profile; site) and SuccessFactors (profile; site), all of whom reported this week, mostly beat or matched Wall Street’s expectations for the quarter. Only Kenexa took a hit when it reported earnings that were lower than the same quarter in 2007.

Both Kenexa and Taleo said they expected the fourth quarter to be tougher and issued financial projections showing a reduction in earnings per share from the third quarter, which ended Sept. 30.

Taleo lost $8.2 million for the third quarter, compared to net income of $2.2 million for the same period last year. The company said this was “primarily from restructuring charges and amortization expense related to the acquisition of Vurv.” Kenexa meanwhile earned $5.4 million and expects to earn between $6.3 million and $7 million for the fourth quarter. That doesn’t take into account a hit of $2 million to $2.5 million. That’s what the company expects it will cost to reduce its workforce by a planned 12 percent.

Those numbers are below what Wall Street was expecting, sinking Kenexa’s stock price to a 52-week low.

SuccessFactors, which has been losing ever-increasing amounts since 2004, was the only one of the three companies to say it expected improvement in the fourth quarter. The company expects revenue for the quarter to be in the $31.0 million to $31.5 million range. For the year, it raised its earlier projection and now says the company will bring in between $109.9 million to $110.4 million. Even with the improving numbers SuccessFactors will show a loss for the year op $1.32 to $1.34 per share.

Article Continues Below

On the job board side, both Monster (profile; site) and privately-held CareerBuilder (profile; site) (which voluntarily reports some numbers) showed a drop in North American revenue. Monster, which released its numbers last week, had total revenue of $332.2 million with the U.S. and Canada contributing $155.2 million of the total. The balance came from its international sales ($142.4 million) and from advertising and fees ($34.5 million). CareerBuilder, which only reports its North American revenue numbers, had $189.9 million.

Both companies’ North American job posting income was down from the same quarter in 2007. Careerbuilder was off $10 million. Monster was down $20 million. Monster’s profit rose, however, to $42.8 million, or 35 cents per share, compared with $33.3 million, or 26 cents on more shares, ifor the same period last year. Despite the news, some analysts downgraded Monster’s stock rating, fearing that a continuing recession will dampen the company’s overall earnings prospects for at least the next quarter.

John Zappe is the editor of and a contributing editor of John was a newspaper reporter and editor until his geek gene lead him to launch his first website in 1994. He developed and managed online newspaper employment sites and sold advertising services to recruiters and employers. Before joining ERE Media in 2006, John was a senior consultant and analyst with Advanced Interactive Media and previously was Vice President of Digital Media for the Los Angeles Newspaper Group.

Besides writing for ERE, John consults with staffing firms and employment agencies, providing content and managing their social media programs. He also works with organizations and businesses to assist with audience development and marketing. In his spare time  he can be found hiking in the California mountains or competing in canine agility and obedience competitions.

You can contact him here.


1 Comment on “Tech Vendors Report Good 3rd Quarter; Job Boards Down

  1. I had to laugh at the positive spin of the headline’s juxtaposition of the article’s doublespeak content: “We had a great third quarter even though we lost money or our stock is in free fall or we’re laying off a bunch of people.”


    On one of the ERE groups, the brilliant Martin Snyder of Main Sequence pointed out that ATS is where investment dollars go to die. The smaller, privately held providers with conservative growth & emphasis on customer service are more reliable, stable business partners than those seeking to market share dominance. Anyone remember EZ Access? Or iSearch? Or Recruitmax?

    I came across an item in Forbes, a bit of historic wisdom on the curse of bigness.

    “The trend toward bigness is one of the most characteristic features of modern society. It manifests itself in the emergence of superpower, big business, big government, and big labor. Local controls have almost disappeared in many aspects of industrial, commercial and political life,” said George B. De Huszar at the Conference on Science, Philosophy and Religion in their relation to the democratic way of life. The Conference was held at the International House of the University of Chicago on September 9, 10 and 11, 1946.

    The current economic slowdown and spread of recession across the globe is a symptom of this curse of bigness.

    Let’s not forget that America is built on SMALL BUSINESS. The bigger they are, the harder they fall.

    Sylvia Dahlby

    >> SmartSearch >> Recruit the Right Way. Right away.
    Staffing Management & Talent Acquisition Software from APS, Inc.

Leave a Comment

Your email address will not be published. Required fields are marked *