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Comcast Gives Envivio A Revenue Boost in Q4

But Shares In Supplier Fall As 22% of Envivio’s Take In The Quarter Come From Comcast 3/21/2014 3:54 PM Eastern

Envivio continued to gain ground with tier 1 U.S. cable operators in the fourth quarter, as Comcast was identified Thursday as a big contributor to the video encoding specialist’s fourth quarter results. But it hardly mattered among investors, as Envivio shares were down 10% in afternoon trading Friday.

Comcast pitched in 22% of overall fourth quarter revenue and 18% of revenue for the vendor’s full fiscal year, Envivio CEO Julien Signès said Thursday on the earnings call with reporters and analysts.

“This is a good example of a Tier 1 customer win, with initial development beginning in the second quarter in fiscal 2014 followed by expansions throughout the year,” he said, noting that  the company’s renewed strength in North America has partly come from the “hiring of a salesperson” focused on tier 1 providers.

Signès didn’t ID that person by name on the call, but it would appear that Envivio’s  hiring of Ira Goldfarb, a former longtime sales exec at SeaChange International, as SVP of global sales and service, last January had something to do with it.

Envivio, which went public in April 2012 and continues to bank on multiscreen video deployments and the promise of cloud DVR and 4K/Ultra HD services, has been bouncing back since mid-2013, when it said improved results were being driven by large orders from two tier 1 North American cable MSOs. Time Warner Cable is the other known major MSO customer for Envivio.

Envivio, like competitors such as Harmonic and Elemental Technologies, is developing a product lineup that uses HEVC/H.265, a more efficient codec that’s expected to factor into both mobile video and 4K deployments.

As HEVC deployments go, “We think this year is the year of establishment and initial trials, so we may not see significant revenue this year,” Envivio CFO Erik Miller said. The company is “certainly anticipating a strong transition into next year, and every time that happens obviously that can trigger significant…purchasing because people are just transitioning headends from either MPEG-2 or MPEG-4 into HEVC.

Envivio pulled in fourth quarter revenues of $12.5 million, up 62% from $7.7 million in the year-ago period. Revenue for the full fiscal year, ended January 31, 2014, reached $43.2 million, up from $39.1 million for fiscal 2013.

Improving revenues was not enough to avoid a fourth quarter net loss of $2.0 million (8 cents per share), narrowed from a net loss of $4.9 million, or 18 cents, in the year-ago period.

That apparently didn’t sit well with investors as Envivio shares fell 40 cents (10.26%) to $3.50 each in late-day trading Friday.