Losses (but optimism) at eLoyalty

Illinois-based enterprise CRM services and solutions provider eLoyalty recently released first quarter results for 2006. eLoyalty reported total revenue of $19.6 million for the quarter and, on GAAP basis, reported a net loss of $3.4 million; according to a non-GAAP basis, eLoyalty’s adjusted earnings loss was $1.9 million.

As for the second quarter of 2006, eLoyalty predicts total revenue to be between $20.3 million and $23.3 million; the firm’s increasing services revenue was forecast at approximately $16.5 million. Despite the apparent bad news, however, with the announcement eLoyalty representatives claimed that the company “continues to focus on accelerating its growth and improving its business model.”

As part of this promise, eLoyalty has created a pair of new management positions in behavioral analytics and converged IP for contact centers; the former was blamed for a negative impact on earnings in the first quarter, with more of the same expected for the second. Also impacting eLoyalty earnings negatively was the company’s heavy emphasis on “significant investment” in the development, selling, delivery, and support resources required to implement and support current and anticipated behavioral analytics activity; company officials reported that the impact of the behavioral analytics investment accounted for the majority of the adjusted earnings losses in the first quarter.