Bookings for inpatient/ambulatory software vendor Allscripts plummeted during the third quarter of 2012 as providers deferred on purchase decisions or waited for new product releases.
The company confirmed it is evaluating strategic alternatives, including sale of the company. Bloomberg News in October reported that Allscripts had received bids from private equity firms. Allscripts also added in a release that “in light of the decision to evaluate strategic alternatives, it is withdrawing its 2012 annual guidance.”
The company’s bookings for the quarter totaled $161.9 million, down 17 percent from the second quarter and down 39 percent from the third quarter of 2011. Revenue of 360.7 million was $3 million less than the year-ago quarter. Net income fell 46 percent to $9.4 million, and non-GAAP income of $39.4 million was down 13 percent.
CEO Glen Tullman says hospitals are delaying purchasing decisions of the Sunrise suite of software until Allscripts’ ownership position is clarified because buying the product would be a 10-year commitment. “We think we’ll be well-positioned once we get past the noise.”
On the ambulatory side, clients are waiting for general availability of meaningful use upgrades in the fourth quarter of 2012 and first quarter of 2013, but the company isn’t seeing a slowdown in prospective clients looking at Allscripts, Tullman adds. Further, 73 percent of third quarter revenue was recurring, up about 5 percent from the previous quarter.
Among other charges, third quarter results included an $11.1 million asset impairment charge on the MyWay suite of ambulatory software for small practices that Allscripts will continue to service but no longer sell.
Allscripts stock price closed down 6 percent to $12.26 per share on Nov. 8, but the price rose more than 7 percent in early after-hours trading.
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