The news from the Lionbridge conference call with investors today was not only about numbers, but also about the resignation of Stephen Lifshatz as the CFO of the company. Among Stephen’s accomplishments was the completion of the project to integrate all the 66 General Ledger platforms in use at Lionbridge into a single accounting system. It looks like the job of CFO became too easy and he is looking for new challenges. According to SEC filings, he will remain employed by the Lionbridge as a Strategic Advisor to provide transition assistance through 24 June 2008.

Now for the numbers: Revenue for the quarter ended June 30, 2007 reached US$114.6 million, but the GAAP income was only US$187,000 compared with US$3 million for the same quarter last year. The indicator that everyone has been watching, net margins, increased by 1.2% from last quarter to 34.7%, nudging closer to the comfort zone of the upper thirties that investors would like to see.

Lionbridge is sticking with its projection that it will grow 8 to 10% this year. It announced that revenues from the top 10 clients — which represent 52% of its portfolio — grew at a pace of 12% compared to 2006. This group includes clients like Google (which doubled its spending with Lionbridge), Microsoft, HP, and Nokia.

Although the company claims that the integration with BGS is complete, there were indications during the call that more offices will be consolidated and more jobs will be cut. What’s the impact on the language service market? As one of just a few publicly traded LSPs and the only one in the United States, Lionbridge is the bellwether of the market. In our July report on the sector, we predicted that the market is waiting for Lionbridge’s lead and that a few quarters of profitability were required to turn the tide. This earnings report with its slightly improved margins helps, but doesn’t substantially change the situation.