Update.com Shares Lose Half Their Value

[London, ENGLAND] On Europe’s Neuer Markt, shares in Austrian
software developer Update.com AG
slumped Thursday after a report that second quarter sales were
lower than expected.

At one point, the shares had lost over half their value, dropping
to below $6, the biggest decline since Update.com went public in
April this year.

A prominent developer of customer relationship management (CRM)
software, Update.com had forecast sales growth of 30-40 percent
for the April-June period. However, sales showed no growth
whatsoever, resulting in the dramatic markdown of the share

Update.com’s Chief Executive Gabriele Rittinghaus recently
published a statement in the company’s annual report promising
to “continue to implement our growth strategy.”

“Although the Neuer Markt has been weak in the last few
months, our share price had risen by over 70 percent
by May 12, 2000,” wrote Rittinghaus.

Some analysts may think that the upbeat message was misleading,
as it was in mid-May that Update.com reported the doubling of
its first quarter operating loss.

Update.com’s shares now stand at a level of over 70 percent
lower than their price at their April debut.

The use of customer relationship management in e-businesses
is at an all-time high. Earlier this week, late deals site
lastminute.com announced technology partnerships to improve
its CRM, while most major e-commerce sites now track their
visitors and try to suggest alternative deals based on the
information gathered.

Update.com blames the lack of growth on a staff shortage in
its sales and marketing department and a failure to complete
projects on schedule.

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