Covisint Corp. reported a loss of 41 cents per share in the second quarter of fiscal 2014, down from loss per share of 17 cents reported in the year ago quarter.
Revenues jumped 19.0% from the year-ago quarter to $24.5 million. Revenue growth was driven by the addition of new customers. Subscription & support revenues increased 19.0% year-over-year to $16.2 million, whereas Service segment revenue increased 20.0% year-over-year to $8.3 million.
Gross margin for the quarter was 42.4%, down from 45.8% in the year-ago quarter. Cost of revenue increased 26.5% to reach $14.03 million. The growth in cost of revenue superseded the growth in revenue. Non-GAAP gross margin for the quarter was 49.2%, down from 51.3% reported in the year-ago quarter.
Total operating expenses as percentage of revenues were 94.2%, much higher than 56.7% reported in the year-ago quarter. Research & development, sales & marketing and general & administrative expenses as percentage of revenues moved up 12, 12.5 and 12.9 percentage points, respectively.
Loss from operations was $12.7 million, wider than $2.3 million reported in the year-ago quarter. Net loss (including stock-based compensation) was$12.4 million or 41 cents per share compared with $5.0 million or 17 cents per share in the year ago quarter. Exiting the second quarter of fiscal 2014, Covisint had a cash balance of $1.07 million.
We believe that strong demand for cloud-engagement platforms in the U.S. and internationally will drive business for the company in the long run. Moreover, new contract wins and increasing customer base are also encouraging for the company.
Competition from companies such as Hewlett Packard Co. (HPQ - Analyst Report), Salesforce.com (CRM - Analyst Report) and CA Technologies (CA), however, remains a concern.