Milwaukee-based ARI Network Services Inc. reported fiscal third quarter net income of $160,000, or 1 cent per share, up from a loss of $571,000, or 5 cents lost per share, in the third quarter of 2013.
Net revenue was $8.2 million, flat from the same period last year.
The data-driven software tool and marketing services firm improved its gross margin by 4 percent through headcount reductions in the second quarter and because it stopped passing costs through for pay-per-click advertising in the third quarter of 2013.
“As we noted on our prior quarter earnings call, we expected year-over-year organic revenue growth in the back half of fiscal 2014 to be challenging, however, we anticipated significant improvement in our earnings and cash flow,” said Roy Olivier, president and chief executive officer. “The results for Q3 are in line with these expectations. The investments we are making in sales and marketing are having a positive impact on new sales and upsells. To date in fiscal 2014, we have invested 29.4 percent of revenue in sales and marketing versus 25.2 percent for the first nine months of last year. This has contributed to new dealer sales and upsell bookings, measured in annual contract value, being up 38.8 percent year-to-date. We believe this should translate into single-digit organic growth in Q1 FY15, growing toward low double-digit growth as we progress through fiscal 2015.”
