SoftwareOne Q1 2024: EMEA dips while services drive overall growth
Reseller posts 3.1 per cent YoY revenue growth as it implements new go-to-market model
SoftwareOne has reported a 3.1 per cent year-over-year increase in Q1 2024 revenues (7.4 per cent constant currency), reaching CHF 246.9m (£216m).
Its total revenues were split between earnings from software & cloud marketplace and software & cloud services, with the former coming in flat, staying at CHF 125.6m in Q1.
While software & cloud services grew 6.6 per cent to CHF 121.3m. Growth was driven by cloud services and software sourcing & portfolio management (previously known as ITAM).
Geographically, while EMEA continued to be the bread winner for the Swiss-based partner, earning CHF 147m, the region's purse was a little lighter this quarter with a 1.3 per cent YoY dip.
SoftwareOne highlighted Southern Europe, Benelux and CEE as areas with good momentum, particularly within services.
North America saw the largest Q1 spike of 19.9 per cent on the back of a number of large client wins to bring in CHF 39.1m.
SoftwareOne CEO Brian Duffy said his company delivered its Q1 2024 results against a backdrop of uncertainty in the economic environment.
"With our integrated offering of software & cloud, services and data & AI, we are strongly positioned to serve our clients with outcome-oriented solutions to meet their needs," he said.
"In particular, we made great progress in supporting clients with the implementation of Microsoft 365 Copilot this quarter, helping them bend the productivity curve, while addressing security, governance and other considerations."
Gross billings in the Microsoft business came to $4.3bn in Q1, up six per cent compared on the previous year. Revenue growth in the Microsoft business continued to offset lower growth in other ISVs.
Duffy adds SoftwareOne is implementing a transformed go-to-market model based on new client segmentation, with a phased rollout starting in key markets in Q2 2024.
He continues: "We have also made significant progress in forming a well-defined global alliance organisation to manage prioritised partnerships with ISVs.
"Lastly, we continue to see traction on our marketplace platform, with the number of clients, cloud subscriptions and sales steadily increasing.
"Combined with a continued focus on operational excellence, we are confident these strategic initiatives will drive accelerated growth and margin expansion in line with our Vision 2026 targets."
The services outfit (ranked number 95 in CRN's Top VARs 2024) also outlined the outlook for 2024 as being based on year-to-date performance and a stabilising market environment.
A transaction committee has been established to address approaches from several parties.
Internal changes
The solutions provider recently selected a new board of directors following its AGM in line with the proposals of the company's founding shareholders.
Despite proxy firms Ethos, Glass Lewis, Inrate and ISS coming in support of the reseller's board, the company's shareholders voted for a new board to be appointed.
The new board came on the heels of SoftwareOne firmly rejecting several takeover bids by Bain Capital and opting to move forward as an independent company, following a strategic review.