Welcome!

Microsoft Cloud Authors: Pat Romanski, John Basso, Liz McMillan, Glenn Rossman, Elizabeth White

News Feed Item

Sonic Foundry Reports First Quarter Fiscal 2013 Results

Sonic Foundry, Inc. (NASDAQ: SOFO), the trusted market leader for video management and academic, enterprise and event webcasting, today announced financial results for its fiscal 2013 first quarter ended December 31, 2012.

GAAP results include:

  • Revenues of $6.6 million, up 6 percent from the fiscal first quarter of 2012
  • Product and other revenue of $2.9 million, up 8 percent from the fiscal first quarter of 2012
  • Services revenue of $3.6 million, up 4 percent from $3.5 million in the first quarter of fiscal 2012
    • Support and maintenance revenue of $1.9 million, an increase of 8 percent over the first quarter of fiscal 2012
    • Event services and hosting revenue of $1.7 million, same as the first quarter of fiscal 2012
  • Unearned revenue balance of $6.0 million, up from $5.6 million at September 30, 2012
  • GAAP net loss of $(139) thousand or $(0.04) per basic share, compared to net loss of $(184) thousand or $(0.05) per basic share in the fiscal first quarter of 2012
  • Gross margin of $4.9 million or 74 percent compared to $4.5 million or 73 percent for the fiscal first quarter of 2012
  • Cash balance of $4.3 million at December 31, 2012
  • Equity investment in earnings from Mediasite KK of $78 thousand related to our current 29% ownership interest in our Japanese partner

Non-GAAP results include:

  • Billings of $6.9 million, an increase of 20 percent over the first quarter of fiscal 2012
  • Product and other billings of $2.9 million, up 8 percent from the first quarter of fiscal 2012
  • Services billings of $4.0 million, an increase of 31 percent over the first quarter of fiscal 2012
    • Support and maintenance billings of $2.2 million, an increase of 48 percent over the first quarter of fiscal 2012
    • Event services and hosting billings of $1.8 million, an increase of 15 percent over the first quarter of fiscal 2012
  • Non-GAAP net income of $685 thousand or $0.18 per basic share compared to non-GAAP net loss of $(164) thousand or $(0.04) per basic share in the first quarter of fiscal 2012

Non-GAAP net income primarily excludes all non-cash related expenses of stock compensation, depreciation, amortization, provision for income taxes and includes the cash impact of billings not recognized as revenue. Reconciliation between GAAP and non-GAAP results is provided at the end of this press release.

At December 31, 2012, $6.0 million of revenue was deferred, of which the company expects to realize approximately $2.3 million in the quarter ending March 31, 2013. Revenue from service contracts is recognized over the life of the contract. Services revenue includes Mediasite customer support contracts as well as training, installation, rental, event and content hosting services.

Gross margin improved from 73 percent in the first quarter of fiscal 2012 to 74 percent in the first quarter of fiscal 2013 due to operational efficiencies in recorder and services costs and a decrease in direct and outsourced event labor costs with lower markups for services which the Company does not provide. These improvements were partially offset by an increase in high definition material cost.

International product and service billings accounted for 30 percent of overall billings, compared to 29 percent in the first quarter of fiscal 2012. During the first quarter of this fiscal year, 82 percent of billings were to preexisting customers, compared to 73 percent in first quarter fiscal 2012, with 56 percent to education customers and 36 percent to corporate.

“We delivered strong financial results in the historically slower first quarter, achieving greater results than Q4 for the first time in our company’s history. This was driven both by the strategic growth initiatives we put in place in 2012 beginning to come to fruition, as well as the completion of several deals that we have been tracking for several quarters. We also saw significant growth in renewals of support contracts as customers committed to the migration to the latest versions of Mediasite. As a result of these efforts, favorable product mix and expense reductions, our gross margins have improved, we have sequential growth in billings and have seen improvement year-over-year in cash from operations,” said Gary Weis, CEO of Sonic Foundry. “This year we will continue to innovate, rolling out the new features and services our customers value highly, while continuing to expand growth opportunities in new market segments.”

Sonic Foundry will host a corporate webcast today for analysts and investors to discuss its fiscal 2013 first quarter results at 3:30 p.m. CT / 4:30 p.m. ET. It will use its patented rich media communications system, Mediasite, to webcast the presentation for both live and on-demand viewing. To access the presentation, register at www.sonicfoundry.com/earnings. An archive of the webcast will be available for 30 days.

EXPLANATION OF NON-GAAP MEASURES

To supplement our financial results presented on a GAAP basis, we use a measure of non-GAAP net income or loss in our financial presentation, which excludes certain non-cash costs and includes certain cash billings not recognized as revenue for GAAP purposes. Our non-GAAP financial measure is not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the factors management uses in planning for and forecasting future periods. Management also believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our operating results and future prospects in the same manner as management and in comparing financial results across accounting periods and to those of peer companies. Our non-GAAP financial measures reflect adjustments based on the following items:

  • Billings not recorded as revenue: We have included the cash effect of billings not recorded as revenue, which are deferred for GAAP purposes, in arriving at non-GAAP net income or loss. Our services are typically billed and collected in advance of providing the service which requires minimal cost to perform in the future. Billings are a better indicator of customer activity and cash flow than revenue is, in management’s opinion, and is therefore used by management as a key operational indicator.
  • Depreciation and amortization of intangible and other assets expenses: We have excluded the effect of depreciation and amortization of assets from our non-GAAP net income or loss. Amortization of intangible assets expense varies in amount and frequency and it is significantly affected by the timing and size of our acquisitions. Depreciation and amortization of asset costs is a non-cash expense that includes the periodic write-off of tooling, product design and other assets that contributed to revenues earned during the periods presented and will contribute to future period revenues as well.
  • Non-cash provision for income taxes: We have excluded the impact of the provision for income taxes from our non-GAAP net income or loss. The provision for income taxes is associated with the difference in treatment of goodwill which is not expensed for GAAP purposes but is amortized over a fifteen year life for Federal income tax purposes. The result is a non-cash expense and liability that will never be paid.
  • Stock-based compensation expenses: We maintain an employee qualified stock option plan under which we grant options to acquire common stock to eligible employees. We also maintain an employee stock purchase plan under which common stock may be issued to eligible employees at a reduced price. Stock-based compensation expenses are recorded for these plans in accordance with FASB Accounting Standards Codification subtopic 718, Compensation-Stock Compensation. Stock-based compensation expense is a non-cash expense. As a result, we have excluded the effect of stock-based compensation expenses from our non-GAAP net income or loss.

About Sonic Foundry®, Inc.

Sonic Foundry (NASDAQ: SOFO) is the trusted market leader for enterprise webcasting solutions, providing video content management and distribution for education, business and government. Powered by the patented Mediasite webcasting platform and webcast services of Mediasite Events, the company empowers people to advance how they share knowledge online, using video webcasts to bridge time and distance, enhance learning outcomes and improve performance.

Certain statements contained in this news release regarding matters that are not historical facts may be forward-looking statements. Because such forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed in or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, uncertainties pertaining to continued market acceptance for Sonic Foundry's products, its ability to succeed in capturing significant revenues from media services and/or systems, the effect of new competitors in its market, integration of acquired business and other risk factors identified from time to time in its filings with the Securities and Exchange Commission.

Sonic Foundry, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except for share data)

(Unaudited)

December 31,

2012

 

September 30,
2012

Assets
Current assets:
Cash and cash equivalents $ 4,286 $ 4,478
Accounts receivable, net of allowances of $85 5,316 5,578
Inventories 1,243 1,053
Prepaid expenses and other current assets   937     757  
Total current assets 11,782 11,866
Property and equipment:
Leasehold improvements 852 852
Computer equipment 4,082 3,851
Furniture and fixtures   865     865  
Total property and equipment 5,799 5,568
Less accumulated depreciation and amortization   2,876     2,624  
Net property and equipment 2,923 2,944
Other assets:
Goodwill 7,576 7,576
Investment in Mediasite KK 498 420
Other intangibles, net of amortization of $185 and $180   10     15  
Total assets $ 22,789   $ 22,821  
 
Liabilities and stockholders' equity
Current liabilities:
Revolving line of credit $ - $ -
Accounts payable 1,162 1,604
Accrued liabilities 941 850
Unearned revenue 5,521 5,284
Current portion of capital lease obligation 156 129
Current portion of notes payable   667     667  
Total current liabilities 8,447 8,534
 

Long-term portion of unearned revenue

435

349

Long-term portion of capital lease obligation

157

131

Long-term portion of notes payable 600 766
Leasehold improvement liability 510 532
Deferred tax liability   2,030     1,970  
Total liabilities 12,179 12,282
 
Stockholders' equity:

Preferred stock, $.01 par value, authorized 500,000 shares; none issued
and outstanding

5% preferred stock, Series B, voting, cumulative, convertible, $.01 par
value (liquidation preference at par), authorized 1,000,000 shares,
none issued

 

 

Common stock, $.01 par value, authorized 10,000,000 shares; 3,913,640
and 3,909,040 shares issued and 3,900,924 and 3,896,324 shares
outstanding

 

39

 

39

Additional paid-in capital 189,669 189,459
Accumulated deficit (178,903 ) (178,764 )
Receivable for common stock issued (26 ) (26 )
Treasury stock, at cost, 12,716 shares   (169 )   (169 )
Total stockholders' equity   10,610     10,539  
Total liabilities and stockholders' equity $ 22,789   $ 22,821  
 

Sonic Foundry, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except for share and per share data)

(Unaudited)

    Three Months Ended December 31,

2012

 

2011

 
Revenue:
Product $ 2,841 $ 2,599
Services 3,640 3,500
Other   71     86  
Total revenue 6,552 6,185

Cost of revenue:

Product 1,314 1,261
Services   371     417  
Total cost of revenue   1,685     1,678  
Gross margin 4,867 4,507
 
Operating expenses:
Selling and marketing 3,007 2,772
General and administrative 815 825
Product development   1,176     982  
Total operating expenses   4,998     4,579  
Loss from operations (131 ) (72 )
 
Equity investment in earnings from Mediasite KK

78

-

Other expense, net   (26 )   (52 )
Loss before income taxes (79 ) (124 )
Provision for income taxes   (60 )   (60 )
Net loss $ (139 ) $ (184 )
 
Net loss per common share:
– basic $ (0.04 ) $ (0.05 )
– diluted $ (0.04 ) $ (0.05 )
 

Weighted average common shares

– basic

 

3,897,880

   

3,839,907

 

– diluted

  3,897,880     3,839,907  

Non-GAAP Consolidated Statements of Operations

(in thousands, except for per share data)

   
Fiscal Quarter Ended

December 31, 2012

Fiscal Quarter Ended

December 31, 2011

GAAP

 

Adj(1)

  Non-GAAP

GAAP

 

Adj(1)

 

Non-GAAP

 
Revenues $ 6,552 $ 323 $ 6,875 $ 6,185 $ (473 ) $ 5,712

Cost of revenue

1,685

1,685

1,678

1,678

Total operating expenses

 

4,998

   

(441

)

4,557

   

4,579

   

(433

)

 

4,146

 

Income (loss) from operations

(131

)

764

633

(72

)

(40

)

(112

)

Equity investment in earnings from Mediasite KK

78

78

Other expense, net (26 ) (26 ) (52 ) (52 )
Provision for income taxes   (60 )   60       (60 )   60      

Net income (loss)

$

(139

)

$

824

 

$ 685

 

$

(184

)

$

20

 

$

(164

)

Basic net income (loss) per common share

 

$

 

(0.04

 

)

 

$

 

0.21

 

 

$ 0.18

 

 

$

 

(0.05

 

)

 

$

 

0.01

 

 

$

 

(0.04

 

)

 

(1)Adjustments consist of the following:

 
Billings $ 323 $ (473 )
Depreciation and amortization 258 201
Non-cash tax provision 60 60
Stock-based compensation(2)  

183

   

232

 
 
Total non-GAAP adjustments

$

824

$

20

 

(2) Stock-based compensation is included in the following GAAP operating expenses:
 
Selling and marketing $ 118 $ 157
General and administrative 10 14
Product development   55     61  
 
Total stock-based compensation

$

183

$

232

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo Silicon Valley Call for Papers is now open.
I wanted to gather all of my Internet of Things (IOT) blogs into a single blog (that I could later use with my University of San Francisco (USF) Big Data “MBA” course). However as I started to pull these blogs together, I realized that my IOT discussion lacked a vision; it lacked an end point towards which an organization could drive their IOT envisioning, proof of value, app dev, data engineering and data science efforts. And I think that the IOT end point is really quite simple…
"My role is working with customers, helping them go through this digital transformation. I spend a lot of time talking to banks, big industries, manufacturers working through how they are integrating and transforming their IT platforms and moving them forward," explained William Morrish, General Manager Product Sales at Interoute, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus...
Verizon Communications Inc. (NYSE, Nasdaq: VZ) and Yahoo! Inc. (Nasdaq: YHOO) have entered into a definitive agreement under which Verizon will acquire Yahoo's operating business for approximately $4.83 billion in cash, subject to customary closing adjustments. Yahoo informs, connects and entertains a global audience of more than 1 billion monthly active users** -- including 600 million monthly active mobile users*** through its search, communications and digital content products. Yahoo also co...
A critical component of any IoT project is what to do with all the data being generated. This data needs to be captured, processed, structured, and stored in a way to facilitate different kinds of queries. Traditional data warehouse and analytical systems are mature technologies that can be used to handle certain kinds of queries, but they are not always well suited to many problems, particularly when there is a need for real-time insights.
Amazon has gradually rolled out parts of its IoT offerings in the last year, but these are just the tip of the iceberg. In addition to optimizing their back-end AWS offerings, Amazon is laying the ground work to be a major force in IoT – especially in the connected home and office. Amazon is extending its reach by building on its dominant Cloud IoT platform, its Dash Button strategy, recently announced Replenishment Services, the Echo/Alexa voice recognition control platform, the 6-7 strategic...
The best-practices for building IoT applications with Go Code that attendees can use to build their own IoT applications. In his session at @ThingsExpo, Indraneel Mitra, Senior Solutions Architect & Technology Evangelist at Cognizant, provided valuable information and resources for both novice and experienced developers on how to get started with IoT and Golang in a day. He also provided information on how to use Intel Arduino Kit, Go Robotics API and AWS IoT stack to build an application tha...
IoT generates lots of temporal data. But how do you unlock its value? You need to discover patterns that are repeatable in vast quantities of data, understand their meaning, and implement scalable monitoring across multiple data streams in order to monetize the discoveries and insights. Motif discovery and deep learning platforms are emerging to visualize sensor data, to search for patterns and to build application that can monitor real time streams efficiently. In his session at @ThingsExpo, ...
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
SYS-CON Events announced today that 910Telecom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Big Data, cloud, analytics, contextual information, wearable tech, sensors, mobility, and WebRTC: together, these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at @ThingsExpo, Erik Perotti, Senior Manager of New Ventures on Plantronics’ Innovation team, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it ...
SYS-CON Events announced today that Venafi, the Immune System for the Internet™ and the leading provider of Next Generation Trust Protection, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Venafi is the Immune System for the Internet™ that protects the foundation of all cybersecurity – cryptographic keys and digital certificates – so they can’t be misused by bad guys in attacks...
It’s 2016: buildings are smart, connected and the IoT is fundamentally altering how control and operating systems work and speak to each other. Platforms across the enterprise are networked via inexpensive sensors to collect massive amounts of data for analytics, information management, and insights that can be used to continuously improve operations. In his session at @ThingsExpo, Brian Chemel, Co-Founder and CTO of Digital Lumens, will explore: The benefits sensor-networked systems bring to ...
Manufacturers are embracing the Industrial Internet the same way consumers are leveraging Fitbits – to improve overall health and wellness. Both can provide consistent measurement, visibility, and suggest performance improvements customized to help reach goals. Fitbit users can view real-time data and make adjustments to increase their activity. In his session at @ThingsExpo, Mark Bernardo Professional Services Leader, Americas, at GE Digital, discussed how leveraging the Industrial Internet a...
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
In addition to all the benefits, IoT is also bringing new kind of customer experience challenges - cars that unlock themselves, thermostats turning houses into saunas and baby video monitors broadcasting over the internet. This list can only increase because while IoT services should be intuitive and simple to use, the delivery ecosystem is a myriad of potential problems as IoT explodes complexity. So finding a performance issue is like finding the proverbial needle in the haystack.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...