Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from John DiFucci - JP Morgan.
John DiFucci – JP Morgan
Question on the guidance, could you give us a little more information about where you put the caution in? Obviously it was a tough quarter but at the same time there was some strength, especially the cash flow number looked really good, I would imagine because there weren’t a lot of large deals, which you did comment at the end, which sends up receivables.
But at the same time, cash flow was really strong this quarter and your guidance, although you had a lot of comments that sounded pretty conservative, still looks to be, for the year anyway, it looks pretty decent. You’re showing some pretty decent growth in cash flow and some of the numbers there. So maybe if you could just give us a little more color around the conservatism that you actually put into the guidance.
Murray Rode
John, for starters, we did effectively lower annual guidance on a couple of dimensions, both total revenue and license, so that’s where some of the conservatism comes in. I think we have said all along, as we’ve entered the year, that we really didn’t feel that the guidance we were giving was that aggressive since it originally only assumed about 6%-9% growth in the core business and then had a full year of Spotfire in the numbers versus a half year. So we’ve backed off a notch from that with this guidance.
At the same time, as I think both Vivek and I said in our comments, we still remain pretty positive on the opportunity and I think the conservatism is really more a nod to take into account of a little bit more volatility perhaps, because of the macro environment.
So a little bit more conservative on revenue and then because we do feel we are more conservative on our expenses we can still maintain the EPS guidance we have.
John DiFucci – JP Morgan
But can you give us a little more, because you’re still planning to hire more, keep your goals for sales people. What expenses, is it marketing, or what are the areas where you think maybe you’ll cut back a little bit?
Murray Rode
A few things. If you think about it, the sales organization is a pretty big organization and has a variety of different roles, not just quota-heads. So there are roles that we have already been streamlining to make room for more quota-heads and simplifying our sales organization. And that’s something we’ve done through the first half of the year.
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