Replies to post #72521 on Savvy Trades and Investments

[researcher59]

SEAC -.48 to 1.95, getting whacked after the PR and 8K filing -

WALTHAM, MA – May 21, 2020 – SeaChange International Inc. (NASDAQ: SEAC), a leading provider of cloud and on-premise video delivery platforms worldwide, has provided an update on the impact of recent macro events on its operations, as well as actions the Company has taken in response to the COVID-19 pandemic.

Fiscal First Quarter 2021 Financial Impact

Similar to the majority of global industries, the video delivery technology industry has been meaningfully impacted by the effects of COVID-19. The intensifying COVID-19 crisis during March and April 2020 significantly slowed customer engagement due to customers working from home, and many customers focusing their resources on remote networking support and servicing the growing demand for bandwidth due to higher network usage caused by COVID-19 confinement. This has caused a number of SeaChange’s potential customers to delay making a final decision regarding their Framework engagements. Based on the foregoing, management currently expects total revenue for the fiscal first quarter ended April 30, 2020 to be lower than the comparable period in fiscal 2020. Management believes a majority of the Company’s customers have simply delayed making a final decision regarding their originally planned engagements, pending the return to a more normal operating environment.

Company Response and Measures to Improve Financial Resiliency

The COVID-19 pandemic has severely impacted SeaChange’s customers’ ability to conduct business, and as set forth above, its customers have delayed making technology decisions regarding their delivery infrastructure. As a result, SeaChange has shifted its business operations to further reduce our operating expenses and to align its strategy with current market conditions. In late April and May, the Company instituted additional cost-optimization measures. These measures are in addition to the actions the Company took in fiscal 2020 that resulted in more than $12 million in annualized cost savings.

In line with these measures, the Company is continuing to take actions to improve its working capital position and to ensure the business is positioned to not only mitigate the present macro risks but also to capitalize on the anticipated demand for its solutions during the second half of fiscal 2021. Management expects to see stronger demand for the Framework solution in the second half of fiscal 2021 as TV providers look to leverage SeaChange’s technology to reduce operating expenses and monetize their growing unsold advertising capacity.

Business Outlook

As indicated in the Company’s full year fiscal 2020 earnings call on April 6, 2020, management anticipated to be in a position to provide more clarity regarding its full year fiscal 2021 guidance by this time. Unfortunately, the effects of COVID-19 have been longer lasting than we initially expected, with many of the countries in which SeaChange’s prospective customers are based continuing to be in various stages of government-mandated lockdown, causing the Company to be unable to provide more detailed guidance at this time. The Company intends to provide fiscal 2021 guidance when management has more visibility with respect to returning to a more normal operating environment.

Management Commentary

“The effects of COVID-19 across the global economy, including the TV and video technology industry specifically, had a pronounced impact on our ability to finalize the closure of new engagements during the first quarter, as customers are focused on their internal operations and supporting work-from-home enablement tasks,” said CEO Yossi Aloni. “Recognizing the ongoing uncertainty from the current crisis and its related effects on the commercial activity, we have enacted several precautionary measures to further ensure our business remains financially secure and our long-term viability remains intact. In late April, we implemented a new plan to reduce our operating costs and further optimize our organization. We will continue pursuing the necessary measures to ensure SeaChange emerges from this situation in a strong financial and operational position.”

[hweb2]

Yeah terrible news on SEAC. But not unexpected given the negative commentary about the current quarter on the last CC. Maybe people didn't think the quarter would be this much of a disaster. They're forecasting fiscal Q1 revenues to be below last year. And the year ago Q1 was an awful quarter with only $8.4M in revenues. So Q1 revenues this year will be below $8.4M. Down sequentially from over $19M in revenues in Q4. Ouch.

Good luck to those buying below $2 for a bounce. It might in this incredibly buoyant market. I'm staying away. Still have no clue what management was thinking with SEVERAL pumpy PRs in March & April. When they knew Q4 was going to miss estimates and business was falling off a cliff. They tried to paint the picture that SEAC was benefiting from the lockdown, when it was actually quite the opposite. I'm surprised no shareholder lawsuits yet. They'd have a strong case imo