Corel is having financial troubles, will they survive?
Corel has long been a major software company with high brand awareness. Probably most familiar for its Corel Draw and Corel Paint programs, it has ventured into many different areas in the software business. WordPerfect, at one time was the world's favorite wordprocessing application, is now owned by Corel. Corel also recently took a bold move into the Linux market by producing its own version of the Linux operating system. Corel's Linux has been receiving excellent reviews and is stated by many to be the easiest to use Linux available. On the website, Cnet, Corel's Linux operating system is at the top of the download for Linux software for many weeks running. So, what is happening with the company? Well, since 1994 revenues have rose from $164 million to $334 million in 1996. Since 1996 revenues have been declining probably as a result of Microsoft Office taking over as the standard wordprocessor/spreadsheet/database programs. In 1999 revenues were only $243 million. The company's history is that of profits and losses, unlike competitor Microsoft. According to the most recent statement, the company has $29 million in cash. In the new releases, officials from the company stated that the company could run out of cash in 3 months if the merger with Inprise/Borland doesn't go through. Inprise/Borland doesn't look much better than Corel. Since 1995, revenues have struggled to beat the $254 million that was reported. During the most recent 12months, revenues were $174 million. Like Corel, the company has had a rough history with many years of losing shareholder money. However, the company has about $239 million in cash as compared to Corel's $29 million. The future for these companies seems very unstable. We have yet to see a killer product from these companies that consitently makes money. Perhaps if Corel could start making money on Linux, it could pull itself out of trouble. Only time will tell.
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