Avid Posts Q2 Loss, Announces Further Reorganization
Editing and storage supplier Avid reported revenues of $150.5 million for the second quarter of 2009, compared to $222.9 million for the same period in 2008, and posted a net loss for the quarter of $15.9 million, or $.43 per share, compared to a net loss of $10.4 million, or $.28 per share, in the second quarter of 2008.
The net loss for Q2 included amortization of intangibles, stock-based compensation, restructuring costs and related tax adjustments, collectively totaling $10.4 million. Excluding these items, the non-GAAP net loss was $5.5 million for the second quarter, or $.15 per share, said the Tewksbury, Mass.-based firm.
Speaking on the company’s earnings conference call, Avid chairman and CEO Gary Greenfield said that much of the year-on-year loss was attributable to weak macroeconomic conditions and the divestment of non-strategic businesses. He said that Avid continues to make progress in its reorganization, which has seen several top executives depart.
Avid’s Chief Technology Officer, Dave Lebolt, and GM of Video, Paul Lypaczewski, have both left the company since the company’s exhibition at the NAB show in Las Vegas last April. It does not appear that those positions will be refilled. When asked about the CTO spot on the earnings call, Greenfield noted that Avid already “has a lot of architects in the organization” and said he will now be free to focus more on strategy with the promotion of Kirk Arnold, EVP of customer operations, to Chief Operating Officer.
An Avid spokeswoman clarified after the call that plans for the GM of video role remain undetermined, but that the CTO role has been absorbed into the company. Avid is currently looking to hire two senior technology architects, one for audio and one for video.
Meanwhile, this week Avid combined its audio and video product organizations into one unit to “foster more convergence between audio and video,” said Greenfield, and hired Chris Gahagan, a former EMC executive, to run it. As SVP of products, Gahagan will oversee engineering, product strategy and market solutions. There will continue to be separate audio and video business units with their own sales forces, and the company will continue to break out revenues for those units.
Speaking of broad market conditions, Greenfield said that he and Arnold had met recently to review requests-for-proposals (RFPs) for some long-term projects from major network customers.
“It’s been a long time since RFPs have been coming in the door,” admitted Greenfield, who described that news as not necessarily a sign of market momentum, but at least “stabilization.”
But local stations in the U.S. continue to hold back on spending, said Greenfield, who cited the recent financial difficulties of large groups like Young and Sinclair.
“Where we’re clearly seeing people not doing anything is in the local broadcast market, but that’s a U.S. phenomenon,” he said.
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