NetSuite sees strong 2012 on cloud demand
* Q4 adj EPS $0.05 vs est $0.04
* Q4 rev $64.1 mln vs est $63.4 mln
* Says taking market share from rivals like Microsoft
* Shares up 3 pct after hours
(Adds CEO comments, background; update share movement)
By Sayantani Ghosh and Supantha Mukherjee
Feb 2 (Reuters) - NetSuite Inc's (N.N) fourth-quarter results beat Wall Street expectations, as the business software maker gained from a shift by small and mid-sized companies to low-cost, nimbler cloud-based products.
The company said it was taking market share from traditional mid-market and enterprise resource planning vendors like Microsoft Corp (MSFT.O).
"They have a series of products in the mid market that are just dying very rapidly and I think we really took Microsoft to the woodshed this quarter," Chief Executive Zach Nelson told Reuters.
NetSuite, which is majority owned by Oracle Corp's (ORCL.O) billionaire Chief Executive Larry Ellison, makes web-based software for small and mid-sized businesses to manage their networks and customer-relationship management tools.
Brokerage Goldman Sachs expects companies like NetSuite to fare well in 2012, boosted by increasing awareness of firms that offer software as a service, aggressive salesforce hiring and improving customer retention rates.
"We are buyers of NetSuite as we see strong share appreciation over the next 12 months and positive catalysts near term," the brokerage said in an earnings preview note dated Jan. 10.
CEO Nelson said NetSuite will hire more this year than it did in 2011 and plans to add about 500 to the company's workforce.
For the fourth quarter, NetSuite earned 5 cents a share, excluding items, ahead of consensus expectations of 4 cents a share, according to Thomson Reuters I/B/E/S.
Revenue rose 23 percent to $64.1 million, while billings, a key metric for software-as-a-service firms, jumped 36 percent to $78.8 million.
Subscription and support revenue grew 23 percent to $54.2 million.
Analysts had expected total revenue of $63.4 million.
Shares of the San Mateo, California-based company rose to $45.75 in extended trading. They closed at $44.36 on Thursday on the New York Stock Exchange.
The stock has risen 12 percent since NetSuite reported third-quarter results early November.
(Reporting by Sayantani Ghosh and Supantha Mukherjee in Bangalore; Editing by Maju Samuel)
((sayantani.ghosh@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: sayantani.ghosh.reuters.com@reuters.net)) Keywords: NETSUITE/
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