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The European technology market stubbornly refuses to show any signs of recovery. The Infoconomy EuroIndex, which tracks the revenue growth of the 100 most significant European technology vendors, dropped from -5.1% to -5.9% in the last month. This continuing slide compares unfavourably to Infoconomy’s Global Index, which is dominated by US-based companies. In October 2002, this index continued to improve slowly, edging up to -6.4% from -7.7% a month earlier. Further improvements to the global index are likely in the coming months.
After an initially slow reaction, Europe is now feeling the full effects of the tech industry recession. At the same point a year ago in 2001, the Infoconomy EuroIndex stood at a buoyant 15.4%. An increasing number of European vendors suffered falling revenues in their latest quarters – some three-quarters of the companies reporting this month, in fact.
One of the few positive influences on the index was Germany-based enterprise applications giant SAP – the
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largest company by revenue on the Index. SAP’s thirdquarter sales rose 3% on the same quarter in 2001. A number of smaller suppliers, including Israel-based testing and performance software vendor Mercury Interactive, where revenue grew 17% year-on-year, also made a positive contribution.
Once again IT services suppliers dragged the index down. UK-based Logica and Computacenter, for example, reported drops in revenue of 20% and 17% respectively, while Swedish IT services company WM-data lost 45% of its sales. Poor performances at several of Europe’s big-name software suppliers, including Israel-based (but Nasdaq-listed) Check Point Software, also did not help.
