This much is certain: Corillian Corp. has won a contract with the thrift giant Washington Mutual Inc.
There was some uncertainty when Corillian revealed in its first-quarter earnings report last week that it had landed another top 10 U.S. financial institution as a user of its Internet banking software.
The Portland, Ore., vendors Wednesday news release had strongly hinted that $224-billion asset Wamu, the nations eighth-largest financial services institution by assets, was the new client.
Executives at Corillian named the name in a quarterly earnings conference call after the release, on Wednesday night, saying that Wamu was the win. But there was more confusion the announcement of the contract said the institution would be using the vendors Voyager software for its retail and small-business banking customers.
A spokeswoman for the Seattle company said later, however, that Wamu had only licensed Corillians small-business banking software.
An analyst who participated in Corillians earnings call, John Kraft of D.A. Davidson in Portland, raised his rating to buy from neutral on Thursday. One reason he did so, he said, was that it was his understanding that Washington Mutual had bought in on both sides.
In an interview Friday, Mr. Kraft said he was surprised to learn that Wamu was not licensing Corillians retail banking software.
But the analyst said he was standing by his upgrade of Corillian. There was a lag where they didnt get any big deals, he said. Then they got SouthTrust, which was huge, and Washington Mutual, which was even bigger.
Corillian announced April 10 that $48.8-billion asset SouthTrust Bank, a subsidiary of SouthTrust Corp. of Birmingham, Ala., had signed with it in a joint effort with Dayton, Ohio-based NCR Corp., the ATM manufacturer.
More important to Mr. Kraft, however, was Corillians balance sheet. The last three quarters, theyve been able to hold their cash constant at over $17 million that was a big surprise to analysts, he said. The way I look at it, the risks have been diminished.
An analyst at CIBC World Markets, Jennifer S. Scutti, had a different view. She downgraded Corillian to hold from buy on Friday, citing the unfavorable environment for software companies in general.
Corillian has done a good job of cutting expenses but will probably have a hard time meeting its projection to have a break-even 2002, Ms. Scutti said.
A third analyst, Richard Zandi of Deutsche Bank Securities, reiterated his market perform rating on Corillian in a note Thursday.
Corillian now claims five of the 10 largest banks and five of the 10 largest credit unions as customers, Mr. Zandi wrote. It clearly dominates the top end of the market.
A Corillian spokesman, Matt Cone, said in an interview Friday that the Wamu deal was a very large contract for his company. Were very excited about this agreement.
He said the two would give more details in a forthcoming joint announcement.
As you can imagine, these things are very strategic to the customer, Mr. Cone said. When theyre going live with certain components ... is something they want to keep close to their vest.
In the first quarter Corillian narrowed its net loss to $4 million, or 11 cents a share, from $10.1 million, or 29 cents a share, a year earlier. Revenue fell 26%, to $10.1 million.
It also had an 11-cent-per-share loss in pro forma earnings; the Thomson Financial/First Call consensus estimate was a 14-cent pro forma loss.
Corillian shares closed Friday at $3.03, down 3.2% from the previous Friday.
