Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Richard Baldry - Canaccord Adams.
Richard Baldry - Canaccord Adams
Can you talk about the pricing environment in the quarter whether you think that’s getting more competitive or not given the volume reductions that we’ve seen?
Then can you talk about the pipeline of new deals, you have been signing some pretty good new deals in last couple of quarters. So I was just wondering how you feel that looks heading into second half.
Rory Cowan
As a question on pricing and on pipeline, we will take the second one first. Pipeline, actually seems to be quite firm. We have of course a worldwide sales force activity program and we are seeing as we saw during the last downturn is that many of our customers are really consolidating, if not, sole source, at least down to just two worldwide suppliers.
So we are seeing pipeline, actually is growing quite nicely. Now, it’s a question of, companies actually carrying out these vendor consolidations and actually winding its way through the global finance organization. So we are feeling pretty good. In addition, as I said, our existing customers are really talking again about when products are released, not if they are going to be released, a very subtle transition in discussion. So, I think that’s the first point.
Now, in terms of the pricing environment, pricing has always an issue, we are finding curiously as procurement gets more involved in these transactions, we tend to shine because our unique technology really allows the entire organization, not just one division to take advantage of our cost opportunities, of our productivity and efficiency. So yes, there is more price discussion than normal. But I think we are holding up pretty well compared to what I hear from other industries.
Richard Baldry - Canaccord Adams
Just to check a figure, can you talk about headcount and on the guidance to be roughly break even in the quarter, is that post charges or pre one time charges as I look at it and you are essentially breaking from operation this quarter, and still in cost cutting mode on a roughly flattish revenue performance, I would have thought that maybe you would be talking about a slight sequential increase in profitability?
Rory Cowan
To answer the second part of that question, we just indicated that we expect third quarter to be down sequentially as it typically is. So, historically anywhere from 2% to 5%. So we do see a downward pressure on revenue in Q3 and then backup sequentially in the fourth quarter. So that basically gets us to that approximately break even, actually structuring numbers in second half.
- To read the full transcript on Seeking Alpha, click here »
