SUNNYVALE, CA--(Marketwire - Aug 29, 2012) - eGain Communications (NASDAQ: [ EGAN ])

• Strongest quarterly new orders in a decade
• Hosting revenue for the fourth quarter up 18% sequentially and 35% year-over-year
• Hosting revenue for fiscal 2012 up 21% over fiscal 2011
• Total recurring revenue for the fourth quarter up 9% sequentially and 21% year-over-year
• Total recurring revenue for fiscal 2012 up 18% over fiscal 2011
• eGain expects fiscal 2013 total annual hosting revenue growth of 40% year-over-year
• eGain expects fiscal 2013 total annual revenue growth of between 20% and 25% year-over-year

eGain Communications (NASDAQ: [ EGAN ]), a leading provider of cloud and on-site customer interaction software, today announced results for its fiscal 2012 fourth quarter and full year ended June 30, 2012.

"In fiscal 2012, as planned, we significantly expanded distribution, adding new global partners like SAP. At the same time, we invested in client success by growing our global services team and accelerating product innovation," said Ashu Roy, eGain's CEO.

"Results of our investments are starting to show. New orders for the fourth quarter were the strongest of any quarter in a decade. In the second half of fiscal 2012, we also saw a significant increase in demand for our hosted solutions. In fact, our new hosted contractual commitments were up 384% for the six months when compared to the same period last year. While this booking mix shift to hosting from license negatively impacted our revenue and profitability for the year, it delivers increased revenue visibility for us in fiscal 2013 and beyond."

Mr. Roy concluded, "Looking ahead, we believe we are well positioned to capitalize on the market dynamics, including recent industry consolidation. We are pleased with our sales pipeline and our prospects for meaningful growth in fiscal 2013."

Fiscal 2012 Fourth Quarter and Full Year Results:

Revenue: Total revenue for the fiscal fourth quarter was $10.6 million, compared to $12.6 million for the fourth quarter of fiscal 2011. License revenue for the fiscal fourth quarter was $2.3 million, compared to $5.6 million for fourth quarter last year. Recurring revenue for the fiscal fourth quarter was $6.3 million, an increase of 21% on a year-over-year basis. Professional services revenue for the fiscal fourth quarter was $2.0 million, an increase of 15% on a year-over-year basis.

For the full fiscal year 2012, total revenue was $43.4 million, compared to $44.1 million for fiscal 2011. License revenue was $11.1 million compared to $17.4 million for fiscal 2011. The year-over-year decrease in license revenue is primarily attributable to the continued shift to hosting delivery model. Recurring revenue was $23.6 million, an increase of 18% on a year-over-year basis. Professional services revenue was $8.7 million, an increase of 31% on a year-over-year basis.

Gross Profit: Gross profit for the fiscal fourth quarter was $6.7 million, compared to $9.7 million for the fourth quarter of fiscal 2011. Gross margin for the fiscal fourth quarter was 63%, compared to 77% in the fourth quarter last year. The recurring revenue gross margin for the fiscal fourth increased to 77%, compared to 73% in the fourth quarter last year.

For the full fiscal year 2012, gross profit was $29.9 million, compared to $33.1 million in fiscal 2011. Gross margin was 69%, compared to 75% for fiscal 2011. This decrease in gross margin is primarily attributed to the shift from license revenue to more hosting based revenue, as a percentage of total revenue. The recurring revenue gross margin increased to 77%, from 74% for fiscal 2011. 

Earnings per Share: Net loss for the fiscal fourth quarter was $3.4 million, or a loss of $0.14 per share, compared to net income of $2.1 million, or $0.09 per share on a basic and $0.08 per share on a diluted basis, for the fourth quarter of last year. Net loss for the fiscal fourth quarter included stock-based compensation expense of $336,000 and interest and tax expense of $392,000, compared to stock-based compensation expense of $60,000 and interest and tax expense of $478,000 in the fourth quarter last year.

For the full fiscal year 2012, net loss for fiscal 2012 was $4.9 million, or a loss of $0.20 per share, compared to a net income of $8.5 million, or $0.37 per share on a basic and $0.35 per share on a diluted basis, for fiscal 2011. Net loss for fiscal 2012 included stock-based compensation expense of $856,000 and interest and tax expense of $1.1 million, compared to stock-based compensation expense of $218,000 and interest and tax expense of $1.4 million, for fiscal 2011.

Cash: Total cash, cash equivalents and restricted cash decreased to $10.9 million at June 30, 2012, from $12.5 million at June 30, 2011. Cash provided by operations was $900,000 for fiscal 2012, compared to cash provided by operations of $6.8 million for fiscal 2011.

Deferred Revenue:
Deferred revenue increased to $8.1 million at June 30, 2012, compared to $5.8 million at June 30, 2011. Unbilled deferred revenue, representing business that is contracted but not yet invoiced or collected and off balance sheet, ended the fiscal year at approximately $20.7 million, up from approximately $11.9 million at the end of fiscal 2011.

Fiscal 2013 Guidance: Based on an estimated split of 40% new license contracts and 60% new hosting contracts for fiscal 2013, eGain is estimating fiscal 2013 annual total revenue growth to be between 20% and 25% and annual hosting revenue growth of 40%.

Quarterly Conference Call
eGain will discuss its quarterly results today via teleconference at 5:00 p.m. Eastern Daylight Time. To access the live call, please dial (866) 219-5829, or outside the U.S. (703) 639-1123, at least five minutes prior to the start time. A live webcast of the call can be accessed from the investors section at [ www.egain.com ]. An audio replay of the conference call can be accessed at (888) 266-2081 (U.S. toll-free) or (703) 925-2533 (international). The replay will be available starting two hours after the call and remain in effect for one week. The required pass code is #1588409. An archive of the webcast will also be available on the investors section at [ www.egain.com ].

About eGain
eGain (NASDAQ: [ EGAN ]) is a leading provider of cloud and on-site customer interaction hub software. For over a decade, eGain solutions have helped improve customer experience, optimize service process and grow sales -- across the web, social, and phone channels. Hundreds of the world's largest companies rely on eGain to transform their fragmented sales engagement and customer service operations into unified Customer Interaction Hubs (CIHs).

Headquartered in Sunnyvale, California, eGain has operating presence in North America, EMEA, and APAC. To find out more about eGain, visit [ http://www.eGain.com ] or call the company's offices: +1-800-821-4358 (US), +44-(0)-1753-464646 (EMEA), or +91-(0)-20-6608-9200 (APAC).

Note: eGain, the eGain logo, and all other eGain product names and slogans are trademarks or registered trademarks of eGain Communications Corp. in the United States and/or other countries. All other company names and products mentioned in this release may be trademarks or registered trademarks of the respective companies.

Cautionary Note Regarding Forward-Looking Statements
All statements in this release that involve eGain's forecasts (including the above stated guidance), beliefs, projections, expectations, including but not limited to our financial performance and guidance, the anticipated growth of our business, market trends, plans to invest in our business and expectations regarding the market acceptance of our products, are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on information available to eGain at the time of this release, are not guarantees of future results; rather, they are subject to risks and uncertainties that may cause actual results to differ materially from those set forth in this release. These risks include, but are not limited to, the uncertainty of demand for eGain products, including our guidance regarding revenue and mix of new license and hosting contracts; our expectations related to our operations; our ability to invest resources to improve our products and continue to innovate; our partnerships; our future markets; and other risks detailed from time to time in eGain's filings with the Securities and Exchange Commission, including eGain's annual report on Form 10-K filed on September 27, 2011, and eGain's quarterly reports on Form 10-Q. eGain assumes no obligation to update these forward-looking statements.

Note: eGain is a registered trademark, and the other eGain product and service names appearing in this release are trademarks or service marks, of eGain Communications Corp. All other company names and products are trademarks or registered trademarks of their respective companies.