Multiscreen video-encoding systems vendor Envivio, citing a "general slowdown" in spending by service provider customers, said Monday it expects revenue for the quarter ended July 31 to be $10 million to $11 million, compared with its previous guidance of $17 million to $18 million.
The company's stock plummeted 54% in early trading Tuesday, to $2.61 per share. Envivio went public earlier this spring, with shares closing down 5.7% at $8.49 per share on April 25.
Envivio may be losing deals to Harmonic, according to research notes from analysts at Stifel Nicolaus and Goldman Sachs.
However, Envivio president and CEO Julien Signès said in a statement that the company's "win/loss ratio" in deals did not change.
"During the second quarter, we did not see any changes to our competitive positioning, and our win/loss ratio in the multiscreen market remains consistent with prior experience," Signès said. "Despite this, we experienced a slowdown of major project implementations and a lengthening of sales cycles, which we attribute to the current global economic environment."
Envivio is scheduled to report full earnings for the quarter on Sept. 6.
Envivio, based in South San Francisco, Calif., says it has more than 300 customers in more than 50 countries, including three of the four biggest U.S. cable service providers as well as eight of largest 10 global mobile service providers. The company was founded in January 2000 by a group of engineers from France Telecom, including Signès.
For the year ended Jan. 31, 2012, Envivio reported revenue of $50.6 million, up 69% from the year-earlier period, and net income of $138,000 versus a net loss of $4.8 million the year prior.
In regulatory filings, Envivio has cited Harmonic, Cisco Systems (through its acquisition of Inlet Technologies) and RGB Networks as its primary competitors. In addition, other direct competition in the future may come from Motorola Mobility and Ericsson, according to the company.