SoftwareOne Shares Tumble to Record Low After Guidance Cut

Allegra Catelli and Paula Doenecke
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(Bloomberg) -- SoftwareOne Holding AG shares plunged almost 40% after the Swiss company cut guidance for a second time in three months and reported lower-than-expected revenue.

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The drop erased about 800 million Swiss francs ($925 million) of market value, with investors also unsettled by the departure of Chief Executive Officer Brian Duffy, little more than a year after he joined the firm.

Duffy has decided to take on a new opportunity in the US, SoftwareOne said in a statement. He is replaced by Raphael Erb, a company veteran of more than 25 years.

“We have some homework to do and there are some market issues as well, so honestly it will take some time,” Erb said on a conference call Thursday.

Also weighing on the tech industry was investors’ frosty reaction to Microsoft Corp. results. SoftwareOne is among the largest resellers of Microsoft software licenses, advising companies on purchases.

Erb, who steps up from the role of chief revenue officer, said he continues to expect headwinds from changes at Microsoft, including a net reduction in certain vendor incentives.

The Swiss firm also said that it’s continuing discussions about a possible sale, though noted the challenges of the current business environment. In September, Bloomberg reported SoftwareOne is also exploring a potential combination with smaller rival Crayon Group Holding ASA.

Crayon shares fell 8.1% in Oslo trading on Thursday.

(Updates with Crayon shares in final paragraph)

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