<PAGE>
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM 10-Q
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File Number: 0-25078
PHAMIS, INC.
(Exact name of registrant as specified in its charter)
Washington 91-1141795
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
401 Second Avenue South, Suite 200, Seattle, Washington 98104
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (206) 622-9558
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 of 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES X NO ___
---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
Shares Outstanding
Class March 31, 1996
----- --------------
Common Stock 6,037,532
===============================================================================
<PAGE>
TABLE OF CONTENTS
Page No.
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited):
Condensed Consolidated Balance Sheets- 3
March 31, 1996 and December 31, 1995
Condensed Consolidated Statements of Operations-
Quarters ended March 31, 1996 and 1995 4
Condensed Consolidated Statements of Cash Flows-
Quarters ended March 31, 1996 and 1995 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition 8
and Results of Operations
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 12
Signature 13
2
<PAGE>
PHAMIS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 1996 AND DECEMBER 31, 1995
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------
1996 1995
- - --------------------------------------------------------------------------------
<S> <C> <C>
Assets
------
Current assets:
Cash and cash equivalents $ 2,953 $ 4,488
Investments available for sale, at fair value 18,474 19,890
Accounts receivable, net 9,674 6,153
Accrued revenue receivable 1,655 1,143
Refundable income taxes 760 777
Deferred income taxes 1,045 950
Prepaid expenses and other assets 709 651
--------------------
Total current assets 35,270 34,052
--------------------
Furniture, equipment and leasehold improvements, at cost 7,624 6,396
Less accumulated depreciation and amortization 3,715 3,458
--------------------
3,909 2,938
--------------------
Other investments, at cost 2,043 1,082
Capitalized software costs, net 3,573 3,060
Other assets 390 367
--------------------
Total assets $45,185 $41,499
====================
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Note payable to bank $ - $ 209
Current installments of long-term obligations 230 265
Accounts payable and accrued liabilities 6,661 4,498
Income taxes payable 15 -
Deferred revenue 7,930 7,236
---------------------
Total current liabilities 14,836 12,208
---------------------
Long-term obligations, excluding current installments 125 152
Deferred income taxes 1,315 1,059
Shareholders' equity:
Preferred stock - -
Common stock 15 15
Additional paid-in capital 26,421 25,921
Unrealized gains on investments 6 32
Retained earnings 2,467 2,112
---------------------
Total shareholders' equity 28,909 28,080
- - --------------------------------------------------------------------------------
Total liabilities and shareholders' equity $45,185 $41,499
- - --------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
PHAMIS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
QUARTERS ENDED MARCH 31, 1996 AND 1995
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
- - -------------------------------------------------------------------------------
1996 1995
- - -------------------------------------------------------------------------------
<S> <C> <C>
Net revenues $12,115 $11,663
Cost of revenues 7,000 7,089
-------------------
Gross margin 5,115 4,574
-------------------
Operating expenses:
Sales and marketing 1,867 1,231
Research and development 1,473 732
General and administrative 1,002 1,245
Merger and acquisition costs 292 -
-------------------
Total operating expenses 4,634 3,208
-------------------
Operating income 481 1,366
-------------------
Other income (expense):
Interest income 194 282
Interest expense (12) (20)
Other, net (2) 1
-------------------
Other income (expense), net 180 263
-------------------
Income before income taxes 661 1,629
Provision for income taxes 306 467
-------------------
Net income $ 355 $ 1,162
-------------------
Net income per common share - primary $ .06 $ .19
Net income per common share - fully diluted $ .06 $ .18
Weighted average number of common shares outstanding
- primary 6,389 6,267
Weighted average number of common shares outstanding
- fully diluted 6,389 6,291
- - -------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
PHAMIS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
QUARTERS ENDED MARCH 31, 1996 AND 1995
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
- - -------------------------------------------------------------------------------
1996 1995
- - -------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 355 $ 1,162
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 546 409
Deferred income taxes 175 (265)
Other - (11)
Change in certain assets and liabilities:
Accounts receivable and accrued revenue receivable (4,033) (1,131)
Prepaid expenses and other current assets (58) (61)
Refundable income taxes 17 -
Accounts payable and accrued liabilities 2,163 1,890
Income taxes payable 102 402
Deferred revenue 694 397
------------------
Net cash provided (used) by operating
activities (39) 2,792
------------------
Cash flows from investing activities:
Purchases of investments (10,227) (4,279)
Maturities and sales of investments 11,604 -
Purchases of furniture, equipment and leasehold
improvements (1,232) (610)
Purchases of other investments (961) -
Capitalized software development costs (799) (445)
Increase in other assets (23) (60)
-------------------
Net cash used in investing activities (1,638) (5,394)
-------------------
Cash flows from financing activities:
Net cash in note payable to bank (209) (5)
Principal repayments of long-term obligations (62) (278)
Net proceeds from initial public offering - 4,189
Proceeds from issuance of common stock under stock
option and employee benefit plans 413 435
------------------
Net cash provided by financing activities 142 4,341
------------------
Net increase (decrease) in cash and cash
equivalents (1,535) 1,739
Cash and cash equivalents at beginning of period 4,448 3,306
------------------
Cash and cash equivalents at end of period $ 2,953 $ 5,045
- - -------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
PHAMIS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated balance sheets, statements of
operations and statements of cash flows reflect all adjustments which are, in
the opinion of management, necessary to present a fair statement of the
condensed consolidated financial position at March, 31, 1996 and the condensed
consolidated statements of operations and cash flows for the interim periods
ended March 31, 1996 and 1995.
The accompanying unaudited condensed financial statements have been prepared in
accordance with the instructions for Form 10-Q and, therefore, do not include
all information and footnotes necessary for a complete presentation of the
financial position, results of operations, and cash flows, in conformity with
generally accepted accounting principles. The Company filed audited financial
statements which included all information and footnotes necessary for such a
presentation of the financial position, results of operations, and cash flows
for the years ended December 31, 1995, 1994, 1993, in the Company's 1995 Form
10-K. Prior period balances have been reclassified to conform to the 1996
presentation, and restated for the acquisition of DataBreeze, Inc. discussed in
Note 2 of Notes to Condensed Consolidated Financial Statements.
The results of operations for the interim period ended March 31, 1996 are not
necessarily indicative of the results to be expected for the full year.
NOTE 2. ACQUISITION
On March 20, 1996, the Company acquired DataBreeze, Inc. ("DataBreeze"), a
Florida-based provider of information systems for physician practices.
DataBreeze became a wholly-owned subsidiary of the Company and continues to
operate from its Florida headquarters. The transaction was accounted for as a
pooling-of-interests, and was effected through the exchange of 153,609 shares of
common stock of the Company for all the issued and outstanding shares of
DataBreeze. In connection with the merger, the Company incurred approximately
$292,000 of one-time merger costs consisting principally of transaction fees for
investment bankers, attorneys, and other related charges necessary to consummate
the transaction. The consolidated financial statements for periods prior to the
transaction have been restated to include the accounts and results of operations
of DataBreeze.
The results of operations previously reported by the separate enterprises and
the consolidated amounts for the years ended December 31, 1995 and 1994 are
summarized below. The results of operations, excluding one-time merger costs, of
DataBreeze for the quarters ended March 31, 1996 and 1995 were less than 10
percent of consolidated net revenues and net income (loss), respectively.
Year ended December 31,
-----------------------
1995 1994
(In thousands)
Net revenues:
PHAMIS Inc. $44,003 34,442
DataBreeze 3,162 4,659
------- ------
Consolidated $47,165 39,101
======= ======
Extraordinary item:
PHAMIS Inc. $ - -
DataBreeze - 298
------- ------
Consolidated $ - 298
======= ======
Net income (loss):
PHAMIS Inc. $ 4,546 2,401
DataBreeze (238) 136
------- -----
Consolidated $ 4,308 2,537
======= =====
6
<PAGE>
PHAMIS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3. INVESTMENTS AVAILABLE-FOR-SALE
Investments available-for-sale at March 31, 1996 and December 31, 1995 consist
principally of tax-exempt, investment-grade, interest-bearing securities
diversified among security types and users.
Investments available-for-sale consisted of the following at March 31, 1996:
<TABLE>
<CAPTION>
Unrealized Estimated
Cost gains (losses) fair value
------------------------------------
(In thousands)
<S> <C> <C> <C>
Money market funds $ 304 - 304
State and municipal bonds and notes 9,525 10 9,535
Tax-exempt municipal preferreds 8,636 (1) 8,635
---------------------------------
$18,465 9 18,474
=================================
</TABLE>
At March 31, 1996, approximately $6,000, net of income taxes, of unrealized
holding gains were recorded in shareholders' equity. At December 31, 1995,
approximately $32,000, net of income taxes, of unrealized holding gains were
recorded in shareholders' equity. The weighted average contractual maturity date
for the Company's available-for-sale portfolio was approximately eight months at
March 31, 1996.
NOTE 4. UNCOMPLETED CONTRACTS
Costs, estimated earnings and billings to date on uncompleted contracts were as
follows:
<TABLE>
<CAPTION>
Mar. 31, Dec. 31,
1996 1995
----------------------
(In thousands)
<S> <C> <C>
Costs incurred on uncompleted contracts $ 59,347 $ 55,641
Estimated earnings 37,298 33,321
--------------------
96,645 88,962
Less billings to date 102,920 95,055
--------------------
$ (6,275) $ (6,093)
====================
Included in accompanying balance sheets
under the following captions:
Accrued revenue receivable $ 1,655 $ 1,143
Deferred revenue (7,930) (7,236)
--------------------
$ (6,275) $ (6,093)
====================
</TABLE>
NOTE 5. OTHER INVESTMENTS
In December 1995, the Company purchased an equity interest in a critical care
information systems developer based in Europe, for approximately $1,082,000 in
cash. The equity interest is accounted for under the cost method of accounting.
In addition to the equity interest, the Company entered into an OEM Distribution
Agreement to distribute the critical care system throughout the Company's
customer base. To consummate the Agreement the Company paid certain costs for
advance license fees, which are recorded as prepaid expenses.
In February 1996, the Company signed a distribution agreement with a
California-based software developer of mobile computing solutions for the home
healthcare marketplace. The agreement allows the Company to distribute the home
healthcare solutions throughout its direct sales network. In addition to the
distribution agreement, the Company purchased a minority equity interest in the
developer for approximately $950,000 in cash. The equity interest is accounted
for under the cost method of accounting.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the condensed
financial statements and notes thereto.
Results of Operations
Overview
The Company develops, markets, installs and services enterprise-wide,
patient-centered healthcare information systems for use by large- and
medium-sized healthcare providers. The Company's revenues are derived
from system, license and service sales, support and maintenance fees, and sales
of third-party hardware relating to its products. The Company's total backlog
consists of signed contracts for systems installation, support and maintenance,
and additional software and services that are not yet recognized as revenue.
Revenue for the first quarter ended March 31, 1996, increased 4 percent to $12.1
million from $11.7 million in the first quarter of 1995. The increase in first
quarter revenues was driven by a combined 16 percent increase in systems,
license and service and support and maintenance revenue categories. The
increases in these revenue categories were partially offset by a 53 percent
decline in additional hardware revenues to $964,000 for the first quarter of
1996 from $2.0 million for the first quarter of 1995. Net income, after $292,000
of one-time merger costs, decreased 69 percent to $355,000 or $0.06 per share
compared with $1.2 million or $0.18 per share, in the first quarter of 1995.
Net Revenues, Cost of Revenues and Gross Margins
The following table sets forth the dollar amount of each revenue category, the
percentage that each revenue category represents of total revenue, the dollar
amount of each category of cost of revenues and gross margins, and the
percentage that each category of cost of revenues and gross margins bears to net
revenues for that category:
Quarter ended March 31,
----------------------
1996 1995
---- ----
$ % $ %
(dollars in thousands)
[S] [C] [C] [C] [C]
NET REVENUES:
Systems, licenses and service ............. 9,310 76.8 8,204 70.3
Support and maintenance ................... 1,841 15.2 1,429 12.3
Additional hardware ....................... 964 8.0 2,030 17.4
------- ----- ------- -----
Total ................................... 12,115 100.0 11,663 100.0
COST OF REVENUES:
Systems, licenses and service ............. 5,140 55.2 4,605 56.1
Support and maintenance ................... 1,190 64.6 1,033 72.3
Additional hardware ....................... 670 69.5 1,451 71.5
------ ------
Total ................................... 7,000 57.8 7,089 60.8
GROSS MARGINS:
Systems, licenses and service ............. 4,170 44.8 3,599 43.9
Support and maintenance ................... 651 35.4 396 27.7
Additional hardware ....................... 294 30.5 579 28.5
------- -------
Total ................................... $ 5,115 42.2 $ 4,574 39.2
======= =======
8
<PAGE>
Systems, licenses and service revenues were $9.3 million, a $1.1 million
increase over the same period a year ago. The increase was primarily due to an
increase in the rates realized per revenue hour. The Company's backlog of
systems, licenses and services was $47.9 million (out of a total backlog of
$73.2 million) at March 31, 1996.
Gross margin percentages on systems, licenses and service sales were 44.8% and
43.9% for the three months ended March 31, 1996 and 1995, respectively. The
slightly higher level of gross margin percentages during 1996 is primarily due
to the shift to newer higher margin contracts from older completed, or nearly
completed, contracts with less favorable margins. In addition, the Company's
adoption of more formalized implementation methodologies, the introduction of
release-based products, and additional experience in performing large-system
contract installations contributed to the increased 1996 gross margins.
Support and maintenance revenues increased to $1.8 million in the first quarter
of 1996 from $1.4 million in the first quarter of 1995. The increase in the
number of installed customer sites and increases in fees from certain renewed
support and maintenance contracts contributed to the 29 percent increase over
the prior year. In 1996, gross margins on support and maintenance increased as
the Company has been able to spread the fixed portion of its maintenance costs
over a larger installed customer base. In addition, the Company's support and
maintenance costs have stabilized as more of the Company's customers have
migrated to the Company's release-based products, which decreases the amount of
site-specific maintenance costs incurred by the Company.
Additional hardware revenues were $964,000 and $2.0 million for the quarters
ended March 31, 1996 and 1995, respectively. Sales of additional hardware have
historically experienced significant quarterly fluctuations, as evidenced by the
53 percent decrease in additional hardware revenues in 1996 as compared to 1995,
and may vary significantly from period to period as they are limited in number
and individual sales can have a high dollar value. The level of future hardware
sales may be impacted by both price decreases and by the increasing
opportunities to sell such hardware as the Company's installed customer base
increases.
OPERATING EXPENSES
Sales and Marketing
- - --------------------------------------------------------------------------------
(dollars in thousands)
<TABLE>
<CAPTION>
Percentage Percentage
March 31, of March 31, of
1996 Net Revenues Change 1995 Net Revenues
---- ------------ ------ ---- ------------
<S> <C> <C> <C> <C> <C>
Three months ended $1,867 15.4% 52% $1,231 10.6%
</TABLE>
The increase in sales and marketing expense resulted primarily from increased
personnel costs, corporate marketing and corporate communication program
expenditures necessary to promote the Company's competitive position and expand
its customer base. Sales and marketing expense increased as a percentage of net
revenues in the first quarter of 1996 as the rate of increase in sales and
marketing expense exceeded the rate of increase in net revenues. The Company
believes that this level of expenditure is appropriate to take advantage of
significant opportunities to sell new systems contracts in the current market
environment. The Company's efforts to expand its customer base, promote its
competitive position, and support the sales and marketing of new and existing
applications will continue throughout the remainder of 1996. The Company expects
a leveling off of the related expenses in the second half of the year.
9
<PAGE>
Research and Development
- - --------------------------------------------------------------------------------
(dollars in thousands)
<TABLE>
<CAPTION>
Percentage Percentage
March 31, of March 31, of
1996 Net Revenues Change 1995 Net Revenues
---- ------------ ------ ---- ------------
<S> <C> <C> <C> <C> <C>
Three months ended $1,473 12.2% 101% $732 6.3%
</TABLE>
The Company's research and development efforts focus on enhancing existing
applications and developing new applications for the (R) ENTERPRISE
VIEW(TM), and DataBreeze(TM) systems, and integrating applications from its
third party solution providers. The following table sets forth certain
information regarding research and development expense and amounts of
capitalized software development costs for the quarters ended March 31, 1996 and
1995:
<TABLE>
<CAPTION>
1996 1995
---- ----
(dollars in thousands)
<S> <C> <C>
Research and development expenditures:
Research and development expense................... $1,473 $ 732
Capitalized software development costs............. 799 445
Funded research and development under development
contracts......................................... 126 69
------ ------
Total research and development expenditures........ $2,398 $1,246
====== ======
As a percentage of net revenues:
Research and development expense................... 12.2% 6.3%
Total research and development expenditures........ 19.8 10.7
Capitalized costs as a percentage of total research
and development expenditures....................... 33.3 35.7
</TABLE>
The Company believes it must maintain a substantial commitment to research and
development to remain competitive. Since 1993, the Company has spent increasing
amounts on research and development and expects this trend to continue. The
Company capitalizes software development costs when technological feasibility on
a particular project has been established and thereafter until the related
product is available for general release to customers. Research and development
expense increased $741,000 in the first quarter of 1996, as the Company added
development personnel and devoted increased hours and resources to development
projects. In addition, several of the Company's larger development projects had
reached technological feasibility, which increased capitalized software
development costs by approximately $354,000.
The Company anticipates its level of capitalized software development costs as a
percentage of total research and development expenditures will fluctuate based
upon the nature and timing of specific development projects undertaken,
including anticipated development activities in international markets. Total
expenditures for research and development for the second quarter may increase
slightly compared to those incurred in the first quarter of 1996, as the Company
continues its investment in research and development initiatives. The Company
anticipates a leveling off of such expenditures in the second half of the year.
General and Administrative
- - --------------------------------------------------------------------------------
(dollars in thousands)
<TABLE>
<CAPTION>
Percentage Percentage
March 31, of March 31, of
1996 Net Revenues Change 1995 Net Revenues
---- ------------ ------ ---- ------------
<S> <C> <C> <C> <C> <C>
Three month ended $1,002 8.3% (20)% $1,245 10.7%
</TABLE>
General and administrative expense decreased in the first quarter of 1996
primarily due to a decrease in legal fees related to the successful defense of
the civil action complaint filed by TDS Healthcare Systems Corporation (TDS),
and a reduction in management bonuses. All claims against the Company in this
matter were dismissed in October 1995, and the Company and TDS have agreed that
the judgment entered in the case is final and no appeals will be filed. The
Company will relocate to its new corporate headquarters in the second quarter of
1996, and anticipates incurring approximately $275,000 of one-time, non-
recurring administrative expenses related to its move.
10
<PAGE>
<TABLE>
<CAPTION>
Other Income (Expense), Net
- - --------------------------------------------------------------------------------
(dollars in thousands)
Percentage Percentage
March 31, of March 31, of
1996 Net Revenues Change 1995 Net Revenues
---- ------------ ------ ---- ------------
<S> <C> <C> <C> <C> <C>
Three months ended $180 1.5% (32)% $263 2.3%
</TABLE>
The decrease in other income (expense), net in the first quarter of 1996 was
directly attributable to lower cash, cash equivalents, and investment balances
during the quarter, and lower interest yields due to a shift in investment
portfolio holdings from taxable securities to tax-exempt securities.
<TABLE>
<CAPTION>
Provision for Income Taxes
- - --------------------------------------------------------------------------------------------
(dollars in thousands)
Percentage Percentage
March 31, of Effective March 31, of Effective
1996 Net Revenues Tax Rate 1995 Net Revenues Tax Rate
---- ------------ --------- ---- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Three months ended $306 2.5% 46.3% $467 4.0% 28.7%
</TABLE>
The Company's effective tax rate for the first quarter of 1996 was significantly
greater than the enacted statutory federal tax rate due to one-time,
nondeductible merger costs related to the DataBreeze aquisition (Note 2 of Notes
to Condensed Consolidated Financial Statements). The Company anticipates that
the effective tax rate will approximate the statutory tax rate for the balance
of 1996.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1996, the Company's principal sources of liquidity consisted of
$3.0 million in cash and cash equivalents, $18.5 million in investments
available for sale, $9.7 million of accounts receivable and up to $5.0 million
available under a bank line of credit. As of March 31, 1996, no amounts were
outstanding under this line of credit and the Company was in compliance with all
applicable debt covenants. The Company had working capital of $20.4 million at
March 31, 1996. The Company requires significant down payments on its systems
contracts and attempts to negotiate its subsequent milestone payments so that it
is in a cash positive position throughout most of the contract period. Amounts
billed in excess of costs and earnings on contracts are reflected as deferred
revenue on the Company's balance sheet.
The Company believes existing cash, cash equivalents, investments available for
sale, accounts receivable and available bank credit, together with the
anticipated cash generated from operations and the exercise of stock options
will provide sufficient funds for internal working capital needs, capital
expenditure requirements, new corporate headquarters expenditures, and possible
acquisitions of products or technologies complementary to the Company's business
for the foreseeable future.
11
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits--None
(b) Reports on Form 8-K--No reports on Form 8-K were filed by the Company
during the quarter ended March 31, 1996.
12
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PHAMIS, Inc.
By /s/ Gregg W. Blodgett Date: May 13, 1996
-------------------------------
Gregg W. Blodgett
Vice President of Finance and Administration
Chief Financial Officer and Treasurer
(Principal Accounting Officer)
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from condensed
consolidated balance sheets and condensed consolidated statements of operations
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,953
<SECURITIES> 18,474
<RECEIVABLES> 9,758
<ALLOWANCES> 84
<INVENTORY> 0
<CURRENT-ASSETS> 35,270
<PP&E> 7,624
<DEPRECIATION> 3,715
<TOTAL-ASSETS> 45,185
<CURRENT-LIABILITIES> 14,836
<BONDS> 0
0
0
<COMMON> 15
<OTHER-SE> 28,894
<TOTAL-LIABILITY-AND-EQUITY> 45,185
<SALES> 12,115
<TOTAL-REVENUES> 12,115
<CGS> 7,000
<TOTAL-COSTS> 7,000
<OTHER-EXPENSES> 4,634
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12
<INCOME-PRETAX> 661
<INCOME-TAX> 306
<INCOME-CONTINUING> 355
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 355
<EPS-PRIMARY> .06
<EPS-DILUTED> .06
</TABLE>
