Comcast Software Upgrades Drive SeaChange’s Sales
VOD Vendor Acquires U.K.’s Mobix Interactive for Up to $17 Million
By Todd Spangler -- Multichannel News, 11/26/2008 5:39:00 AM
SeaChange International sales were up 6% for the quarter ended Oct. 31, an increase the video-on-demand vendor attributed to software-upgrade revenue from Comcast, although hardware sales were off 35% in the period.
Total revenue for the quarter was $51.8 million, compared with $49.0 million for the same period last year. Net income was $3.4 million (11 cents per share) compared with net income of $3.3 million in the year-ago quarter. SeaChange reported its quarterly results Tuesday.
“We are delighted to report another quarter of solid financial results marked by strong performance from our software business,” SeaChange president and CEO Bill Styslinger said, in a statement. “The third quarter also included the renewal of our VOD master purchase agreement with Comcast through 2009, further cementing our relationship with the world’s largest service provider of VOD.”
SeaChange’s software revenue in the quarter was $37.6 million, up 29% year-over-year, which it said was “attributable principally to software upgrade revenues from Comcast in connection with the execution during the quarter of a contract renewal with Comcast through 2009 for the purchase of the company’s VOD products and services.”
The growth in software sales also was driven by higher advertising-insertion revenues from U.S. cable television customers because of continued increase in high-definition television channel requirements, according to SeaChange.
SeaChange’s Servers and Storage segment generated quarterly revenue of $10.4 million in the third quarter of fiscal 2009, down 35% compared with the third quarter of fiscal 2008. The company noted that the segment’s revenue for the first nine months of fiscal 2009 was $35.9 million, versus $37.1 million in the first nine months of last year.
For its full fiscal year 2009, SeaChange is forecasting revenue to be approximately 10% higher than fiscal 2008. “Our confidence in our fourth quarter guidance stems from continued high levels of spending on VOD and advertising insertion software primarily from North American service providers and our continued focus on minimizing growth in our operating expenses,” Styslinger said.
Separately, SeaChange also announced the acquisition of all the outstanding shares of Mobix Interactive, a U.K. company that provides software, content aggregation services and branded content for mobile phone operators, for $4.5 million plus up to $12.5 million based on Mobix achieving certain financial and commercial measures over the next three years.
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