Synchronoss Technologies, Inc. Announces 1st Q 2009 Financial Results @$13.31
First quarter revenue was $29.6 million and non-GAAP diluted EPS was $0.11
ConvergenceNow® Plus+ continues to gain traction as two major Smartphone manufacturers enter agreements with Synchronoss
Relationships outside of AT&T increased to 37% of total revenue
On Wednesday May 6, 2009, 4:01 pm EDT
Related: Synchronoss Technologies, Inc.
BRIDGEWATER, N.J.--(BUSINESS WIRE)--Synchronoss Technologies, Inc. (NASDAQ: SNCR - News), the leading global provider of on-demand transaction management software platforms today announced its financial results for the first quarter 2009.
Stephen G. Waldis, President and Chief Executive Officer of Synchronoss, said, “We were pleased with the company’s performance in the first quarter. The significant amount of activity on-boarding new programs and customers onto our platform enabled Synchronoss to deliver solid first quarter results that were consistent with our expectations.”
Waldis added, “We are excited with the growing traction of our ConvergenceNow® Plus+ solution, which is designed specifically to support embedded communication devices such as smartphones, mobile internet devices, laptops and wirelessly enabled consumer electronics such as digital cameras and global positioning systems. Two of the world’s leading smartphone handset providers have agreed to use ConvergenceNow® Plus+, and we believe Synchronoss is uniquely positioned to capture the large and growing emerging device market opportunity.”
For the first quarter of 2009, Synchronoss reported net revenue of $29.6 million, an increase compared to $29.1 million in the first quarter of 2008. Gross profit, including the impact of fair value stock-based compensation expense, was $14.4 million in the first quarter of 2009. Income from operations, in accordance with generally accepted accounting principles ("GAAP"), was $3.3 million, including $1.9 million of fair value stock-based compensation expense. Based on an effective tax rate of 39.4% in the first quarter of 2009, GAAP net income was $2.1 million and GAAP diluted earnings per share was $0.07, compared to $0.13 in the first quarter of 2008.
Non-GAAP gross profit for the first quarter of 2009 was $14.8 million, representing a non-GAAP gross margin of 50%. Non-GAAP income from operations, which excludes fair value stock-based compensation expense, was $5.2 million in the first quarter of 2009, representing a non-GAAP operating margin of 18%. Non-GAAP net income in the first quarter was $3.3 million, leading to non-GAAP diluted earnings per share of $0.11, compared to $0.16 in the first quarter of 2008.
A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."
Synchronoss had cash, cash equivalents, and marketable securities of $74.4 million at March 31, 2009, a decrease of $4.4 million compared to the end of the previous quarter. The company’s positive operating profitability in the first quarter was outweighed by $5.6 million in capital expenditures, including the opening of a new global research & development center and data facility in Bethlehem, PA, in addition to quarter-to-quarter fluctuations in working capital accounts.
“We continue to monitor our overall expenses carefully in order to drive profitability in an environment when many of our customers are facing increasing economic pressures in their business," said Lawrence R. Irving, Chief Financial Officer and Treasurer. "We continue to be pleased with the progress of the growth initiatives in which we are continuing to invest. We have begun the on-boarding process for new transactions and channels at AT&T, in addition to early stage efforts related to a growing number of opportunities with our CSP, VoIP and emerging device customers. We believe our efforts will position Synchronoss to enhance its long-term revenue growth and profitability.”
Other First Quarter Business Highlights
Business related to AT&T represented 63% of total revenue in the first quarter, compared to 64% in the previous quarter and 72% in the year ago quarter. Business outside of the AT&T relationship represented approximately 37% of total revenue in the first quarter, compared to 36% in the previous quarter and 28% in the year ago quarter.
Brightpoint entered into an agreement whereby it will act as an Online Master Dealer for T-Mobile USA. Under the terms of the agreement, Brightpoint will enable its approved customers the ability to offer and sell wireless services from T-Mobile via its end-to-end integrated online activation solution. Brightpoint is utilizing Synchronoss’ ConvergenceNow® Plus+ platform as part of this solution to provide online activation of T-Mobile wireless services.
Announced that Synchronoss’ ConvergenceNow® Plus+ platform enables the end-to-end customer management for AT&T’s CruiseCastSM Mobile TV Service. From purchase and activation to account changes, ConvergenceNow® Plus+ consolidates the orchestration and customer-care operations while providing customers with a superior and seamless experience. AT&T CruiseCast service will offer a robust lineup of 42 entertainment channels, 22 satellite TV and 20 radio channels at launch. The AT&T CruiseCast service enables families, commuters and mobile professionals to watch the same type of television experience in the rear seat entertainment systems of their vehicles that they now have in their homes.
