Why is the Integrated Research (ASX:IRI) share price sliding 6%?

The Integrated Research share price is falling lower today after the company provided an update on its earnings for the first half of FY21.

Integrated Research Limited (ASX: IRI) shares are falling lower today after the company provided the ASX with a market update. At the time of writing the Integrated Research share price is trading 5.66% lower at $3.00.

It has been a somewhat volatile year for the S&P/ASX All Technology Index (ASX: XTX) member. Shares in the company were hard hit by the pandemic but rebounded strongly to a price of $4.92 in August. That is were the good news ended however, with Integrated Research shares falling 39% since then. This means, at its current level, the Integrated Research share price is in the red for the year, down by 9.6%.

A man wearing glasses and a checkered shirt looks gobsmacked as he puts his hand to his cheek, representing the fall of the Zip share price is cheek

Image source: Getty Images

What Integrated Research does

Integrated Research is a global business that supports some of the largest companies in the world. It is specifically involved in the design and implementation of technology that optimises business operations, predicts disruptions, and automates business processes.

Thus, in essence, the company assists organisations to reduce the complexity and improve the transparency of their operations. 

Based in Sydney, the Aussie growth company now boasts more than 1,000 customers in over 60 countries.

What happened?

This morning the software provider confirmed that, as a result of deteriorating trading conditions, its revenue for the first quarter of FY21 is below that of the prior corresponding period (pcp). As such, Integrated Research essentially updated the market confirming what was hinted at during its 2020 annual general meeting (AGM).

The company stated that, based on unfavourable exchange rate movements and year-to-date trading, anticipated revenue for the first half of FY21 has been reduced to $41 to $47 million. Revenue for the pcp was $53.2 million. As a result of the decrease in revenue, lower profits of between $5 to $8 million are also predicted, compared with profit in the pcp of $11.8 million. 

Foolish takeaway

In addition to today's news, Integrated Research has also suffered other setbacks in 2020. As noted at the company's AGM, ongoing global disruption and uncertainty surrounding COVID-19, including widespread business closures, has seen sales cycles lengthen and some customers defer purchasing decisions.

The Australian Dollar has also performed strongly this year, gaining 12% in just six months. And, according reporting in The Australian Financial Review, there may be more hurt ahead for Integrated Research in this regard, with the AFR saying the Australian dollar could surge as high as 85 US cents.

Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Integrated Research Limited. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ASX Share Market News

Two colleagues looking at a graph and comparing share prices.
ASX Share Market News

PLS vs BHP: Which ASX 200 mining stock looks better today?

Comparing PLS vs BHP shares on valuation, dividends, and performance—see which ASX 200 mining stock I think comes out on…

Read more »

Businesswoman working with laptop and documents in office, with virtual finance related graphs and charts.
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

Technology written in orange in tech sector financial diagram.
ASX Share Market News

Tech shares shine while ASX 200 plunges to 4-month low

Technology was the surprise performer, rising 7.34%, during a topsy-turvy week for the local bourse.

Read more »

Smiling man working on his laptop.
Best Shares

BHP vs Codan: Which ASX 200 share is the stronger buy today?

BHP and Codan are both flying, but which ASX share is truly the better buy today? I break down the…

Read more »

Watering can pouring water on increasing piles of coins with green plants on them and a piggy bank and coins on the table.
Opinions

$3,000 buys 1,463 shares in an impressively reliable ASX dividend stock

Here’s what makes this stock one of the best picks for dividends, in my view.

Read more »

A woman is very excited about something she's just seen on her computer, clenching her fists and smiling broadly.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a happy end to the trading week for investors this Friday.

Read more »

REIT on wooden circles with real estate investment trust written above on a yellow background.
REITs

6 ASX REITs just hit 52-week lows. Do any brokers say buy?

Several ASX real estate investment trusts (REITs) have hit 52-week lows as the property sector underperforms the market on Friday.…

Read more »

A financial expert or broker looks worried as he checks out a graph showing market volatility.
Broker Notes

Buy, hold, sell: CBA, Capstone Copper, Codan shares

Let's take a look at some new ratings from the experts.

Read more »