The fat lady is about to sing

(relevance to HPC: some of the companies that effectively bankrolled this effort have been trying to leverage it against Linux, in the HPC space, and have managed to cause customers confusion. ..)

Can’t get any more cliche’ than that. /. links to an arstechnica article on SCO. Turns out the ruling knocked out any pillar of hope for thie rapidly fading company.

Their only real hope now is for a white knight. If I were on SCO’s board, I would, rather immediately, work on ousting the current management team. It is fairly obvious that they have done a “not-good” job with the owners assets. Just look at this chart from Yahoo:



Their market cap is $9.43M as of today. The analysts are saying “SELL SELL SELL“.

Now as interesting as it would be to read something into the numbers here, say the projected -100% growth rate predicted for next quarter, there is a fairly strong likelihood that it is just a bug in Yahoo’s page, as it shows Dec-69 as the current quarter. I am guessing that it doesn’t do error detection on the values returned from the query, and simply lets the data formatter handle “errors” further down in the display logic.

Or maybe the growth rate really will be near -100%.

Well, lets do a little analysis of our own.

They have 142 employees according to their summary page. Lets assume that they have an average salary of $70k/year. So this would mean that their yearly burn rate, ignoring benefits and so forth, is $9.9M. In order to sustain operations and tread water, they have to take in enough such that their operating margin covers their expenses. Lets just round things up and call it $12M/year as their total expenses. This means they need $1M/month in operating margin. It looks like their revenue is dropping about 20% per year (from their most recent 10-k filing). Their gross margin in 2006 was, curiously, $12M. Their OE was $29M. 100% of their revenue is Unix revenue. And 95% of that belongs to Novell apparently.

What have they been doing with Novell’s money is a question I am sure Novell is asking them.

They need either a white knight, or a note to turn out the lights when they close. I would guess that no one wants to touch their liability with a 10 meter pole, so the first option isn’t likely.
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