The Market Rewards Ardent Software Initiatives

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Event Summary

Ardent has announced a number of initiatives to strengthen their DataStage product, most recently a partnership with NEON Systems (NASDAQ: NESY), a provider of OS/390-MVS mainframe access through their NEON Shadow Direct middleware. This development, coupled with their earlier acquisition of Prism Solutions, greatly improves their ability to access legacy mainframe data. See TEC News Analysis Articles: "Data Warehouse Vendors Moving Towards Application Suites", September 29, and "Ardent Software Enters the SAP Data Extraction Market", September 13, 1999, for additional details on new features.

On October 18, Ardent Software (NASDAQ: ARDT) reported record financial results for their third quarter ended September 30, 1999. Pro forma earnings were reported to have increased 64%. Total revenues for the third quarter increased 53% to $45.3 million from $29.7 million in the same quarter of 1998. Data warehouse revenues increased 309% to $19.2 million in the third quarter of 1999, compared to $4.7 million in the third quarter of 1998. Peter Gyenes, chairman, president, and CEO of Ardent, reported the addition of 114 new name accounts using Ardent's data warehousing solutions, including AT&T Network Services, SmithKline Beecham, and The Weather Channel.

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Market Impact

The tremendous rise in earnings indicates that Ardent has correctly sensed the direction in which the Extract/Transform/Load segment of the data warehousing market is moving. One of the traditional weaknesses of ETL tools has been the difficulty in accessing mainframe legacy data. The solution provided by the Prism acquisition is host-based, while NEON's Shadow Direct is a gateway which optimizes DB2 connectivity, simplifies access, and allows the invocation of DB2 stored procedures. These legacy access improvements, coupled with the addition of the ability to extract data from enterprise resource planning packages, has made DataStage an attractive choice.

User Recommendations

Ardent DataStage should be included on any company's list of candidates for a data extraction tool, especially when source data is located on IBM mainframes. Customers should question whether Ardent is modifying their software to optimize NEON access to DB2, or simply forming a consulting/marketing alliance.

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