Synacor, Inc. (NASDAQ: SYNC), the trusted multiscreen technology and
monetization partner for video, internet and communications providers,
device manufacturers, and enterprises, today announced its financial
results for the quarter and year ended December 31, 2016.
"We are seeing strong market validation of Synacor's portal, email,
advertising and video products," said Synacor CEO Himesh Bhise. "We
continue to make excellent progress toward the launch and deployment of
the AT&T portal, and we announced several new customer wins in email and
"We begin 2017 a stronger Synacor, well positioned in attractive and
growing digital markets. We expect accelerated revenue growth of about
30% this year, as we continue to progress on our Path to 3/30/300."
FY 2016 and Q4 2016 Financial Results
Revenue: For fiscal 2016, total revenue was $127.4
million, an increase of 16% compared with fiscal 2015. For the fourth
quarter of 2016, total revenue was $34.9 million, an increase of 8%
compared with the fourth quarter of 2015.
Net Income: For fiscal 2016, net loss was $10.7
million, compared with net loss of $3.5 million in fiscal 2015,
reflecting the investment to support the AT&T portal business. Earnings
per share, or EPS, was a loss of $0.36 compared with a loss of $0.12 in
fiscal 2015. For the fourth quarter of 2016, net loss was $3.1 million
compared with a net loss of $0.4 million in the fourth quarter of 2015.
EPS was a loss of $0.10 compared with a loss of $0.01 in the fourth
quarter of 2015.
Adjusted EBITDA: For fiscal 2016, adjusted earnings before
interest, taxes, depreciation and amortization (adjusted EBITDA), which
excludes stock-based compensation expense, was $3.2 million compared
with $7.6 million for fiscal 2015. The fiscal 2016 adjusted EBITDA
includes $6.3 million in investment (operating expense) to support the
AT&T portal business. For the fourth quarter of 2016, adjusted EBITDA
was $1.2 million, which includes $2.2 million in investment (operating
expense) to support the AT&T portal business. This compares with $2.9
million in adjusted EBITDA for the fourth quarter of 2015.
Cash: Synacor ended the fourth quarter of 2016 with $14.3
million in cash and cash equivalents, compared with $15.0 million at the
end of the prior quarter. Cash generated by operating activities was
$1.5 million for the fourth quarter of 2016, despite the investment in
the AT&T portal business.
Based on information available as of March 15, 2017, Synacor is
providing financial guidance for fiscal 2017 and the first quarter of
fiscal 2017 as follows:
Net Income and adjusted EBITDA guidance for the first quarter and fiscal
year 2017 reflect a portion of the $10 million investment planned from
the second quarter of 2016 through the first quarter of 2017 to deploy
portal services for AT&T.
Conference Call Details
Synacor will host a conference call today at 5:00 p.m. ET to discuss the
fourth-quarter and year-end financial results with the investment
community. Investors interested in listening to the webcast should log
on to the "Investors" section of Synacor's website under the subheading
"Events and Presentations," located at www.synacor.com.
To participate, please login approximately 10 minutes prior to the
webcast. For those without access to the internet, the call may be
accessed toll-free via phone at (877) 201-0168, with conference ID
75167396, or callers outside the U.S. may dial (647) 788-4901. Following
completion of the call, a recorded webcast replay will be available on
Synacor's website. To listen to the telephone replay, call toll-free
(800) 585-8367, or callers outside the U.S. may dial (416) 621-4642. The
conference ID is 75167396.
Known for managed portals and apps, advertising, email and
collaboration, authentication, and end-to-end advanced video services,
Synacor (Nasdaq:SYNC) is the trusted technology development,
multiplatform services and revenue partner for video, internet and
communications providers, device manufacturers, and enterprises. We
deliver modern, multiscreen experiences and advertising to their
consumers that require scale, actionable data and sophisticated
implementation. Synacor enables our customers to better engage with
their consumers. www.synacor.com
Non-GAAP Financial Measures
We use certain non-GAAP financial measures in this release. Generally, a
non-GAAP financial measure is a numerical measure of a company's
performance, financial position or cash flows that either excludes or
includes amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance with
generally accepted accounting principles (GAAP).
We report adjusted EBITDA because it is a key measure used by our
management and Board of Directors to understand and evaluate our core
operating performance and trends, to prepare and approve our annual
budget and to develop short- and long-term operational plans. In
particular, the exclusion of certain expenses in calculating adjusted
EBITDA can provide a useful measure for period-to-period comparisons of
our core business. Accordingly, we believe that adjusted EBITDA provides
useful information to investors and others in understanding and
evaluating our operating results in the same manner as our management
and Board of Directors.
For a reconciliation of adjusted EBITDA to net income, the most directly
comparable financial measure calculated and presented in accordance with
GAAP, please refer to the table "Reconciliation of GAAP to Non-GAAP
Measures" in this press release.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995
"Safe Harbor" statement under the Private Securities Litigation Reform
Act of 1995: This press release contains forward-looking statements
concerning Synacor's expected financial performance (including, without
limitation, its expectations related to the AT&T contract, its
first-quarter and fiscal year 2017 guidance, the statements and
quotations from management and Synacor's strategic and operational
plans). The achievement or success of the matters covered by such
forward-looking statements involves risks, uncertainties and
assumptions. If any such risks or uncertainties materialize or if any of
the assumptions prove incorrect, Synacor's results could differ
materially from the results expressed or implied by the forward-looking
statements we make.
The risks and uncertainties referred to above include - but are not
limited to - risks associated with: execution of our plans and
strategies, including execution against our agreement with AT&T the loss
of a significant customer; our ability to obtain new customers; our
ability to integrate the assets and personnel from acquisitions;
expectations regarding consumer taste and user adoption of applications
and solutions; developments in internet browser software and search
advertising technologies; general economic conditions; expectations
regarding the company's ability to timely expand the breadth of services
and products or introduction of new services and products; consolidation
within the cable and telecommunications industries; changes in the
competitive dynamics in the market for online search and digital
advertising; the risk that security measures could be breached and
unauthorized access to subscriber data could be obtained; potential
third party intellectual property infringement claims or other legal
claims against Synacor; and the price volatility of our common stock.
Further information on these and other factors that could affect
Synacor's financial results is included in filings it makes with the
Securities and Exchange Commission from time to time, including the
section entitled "Risk Factors" in the company's most recent Form 10-Q
filed with the SEC. These documents are available on the SEC Filings
section of the Investor Information section of the company's website at http://investor.synacor.com/.
All information provided in this release and in the attachments is
available as of March 15, 2017, and Synacor undertakes no duty to update
Loss from operations
Loss before income taxes and equity interest
Purchase of treasury stock and shares received to satisfy minimum
Effect of exchange rate changes on Cash and Cash Equivalents
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