Synacor (SYNC) Reports In-Line Q3 EPS, Revenues Miss; Offers FY18 Revenue Guidance Below Consensus

Synacor (NASDAQ: SYNC) reported Q3 EPS of ($0.06), in-line with the analyst estimate of ($0.06). Revenue for the quarter came in at $35.6 million versus the consensus estimate of $38 million.

• Q3 revenue totaled $35.6 million, recurring software revenue of $8.9 million grew 17% YoY
• Q3 net loss was $2.2 million, in line with guidance; adjusted EBITDA improved to $2.7 million, exceeding guidance range and up from $1.8 million a year ago
• Q3 wins include portal and Cloud ID renewal with a major operator, new ShortsTV Network for Cloud ID agreement, and 80 new Zimbra enterprise and government customers

“Our third-quarter financial results reflect our continued attention to profitability and our focus on driving high-margin recurring software revenue,” said Synacor CEO Himesh Bhise. “Recurring software revenue from collaboration and identity management platforms grew 17% from a year ago. Our adjusted EBITDA for the quarter was $2.7 million, representing a 45% increase from the prior-year quarter.

“We are being disciplined in steering away from low-margin, publisher-based advertising revenue, even if it impacts our top line, so that we can focus on growing recurring revenue and improving profitability,” concluded Bhise.

GUIDANCE:

Synacor sees FY2018 revenue of $140-143 million, versus the consensus of $154.07 million.

For earnings history and earnings-related data on Synacor (SYNC) click here.

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