Synchronoss Technologies
Inc. (“Synchronoss” or the
“Company”) (Nasdaq: SNCR), a global leader and innovator
in cloud, messaging, and digital products and platforms, today
reported financial results for its third quarter ended September
30, 2022.
Third Quarter and Recent Operational
Highlights:
- Announced 15% year-over-year Cloud subscriber growth
for the third quarter of 2022. The tenth consecutive
quarter of double-digit subscriber growth has been driven by the
continued adoption of the Company’s Personal Cloud product by its
customers’ subscribers, including Verizon and AT&T.
- Extended current Cloud agreement with AT&T for an
additional option year through the end of 2023. The
extension enables AT&T to continue utilizing Synchronoss
Personal Cloud to power its AT&T Personal Cloud offering with
no changes to the commercial terms.
- Consolidated user content to Verizon’s Private
Storage infrastructure, allowing for more
efficient management of all digital content on the Synchronoss
Personal Cloud platform for Verizon customers. This consolidation
also enables Synchronoss to more fully focus on developing new
features and functionality, while simultaneously eliminating its
investment into hosting petabytes of costly storage infrastructure
going forward. Critically, this consolidation will enable
functionality that will utilize the increased speed, reduced
latency, and scalability of Verizon’s 5G network and
next-generation storage infrastructure.
- Signed a Letter of Intent with a tier one global
operator and began work to launch a new personal cloud solution in
2023. The carrier will provide access to an extensive
mobile subscriber base, which is predominantly postpaid in nature.
The new customer launch will begin contributing professional
services revenues in Q4 2022 and is forecasted to deliver more than
$50 million over the term of the relationship.
- Appointed Louis (“Lou”) Ferraro, Jr. as Chief Financial
Officer, effective November 3. Ferraro had been serving as
acting CFO since August and has been with Synchronoss since 2018.
Synchronoss also appointed Mina Lackner as Chief Human Resources
Officer, further expanding and improving the composition of its
senior leadership team in two key areas.
Management Commentary“In Q3, we took proactive
steps to preserve our profitability and cash flow generation,” said
Jeff Miller, President and CEO of Synchronoss. “Our successful
actions resulted in positive income from operations and adjusted
free cash flow, which improved nearly $11.8 million and $6.6
million, respectively, on a year-over-year basis. Further, we are
encouraged by the continued strength of our cloud subscriber growth
and invoiced Cloud revenue growth during the quarter, increasing
15% and 7%, respectively, during the period, highlighting the
underlying strength of our cloud-first strategy.
“We extended our Cloud agreement with AT&T, marked the next
chapter of our long-standing relationship with Verizon with an
agreement to leverage their private storage infrastructure and
signed an LOI with a global tier one operator under which we began
work to launch their new cloud solution next year. Additionally, we
extended agreements with two prominent Italian customers that have
relied on Synchronoss solutions for over 20 years, respectively.
Our solutions are becoming more relevant and essential to a large
and growing market supported by global 5G adoptions and other major
technology evolutions. While we recognize there is still much work
to be done, the fundamentals of our business remain solid, and our
cloud-first strategy is on the trajectory to deliver high-growth,
recurring revenue, and cash generative capabilities.”
Key Performance Indicators ("KPIs"):
- Cloud subscriber growth of 15% continued the Company’s ongoing
performance of year-over-year double-digit subscriber growth. Third
quarter GAAP Cloud revenue decreased 11% year-over-year as a result
of expected deferred revenue run-off in the current quarter as well
as one-time professional services fees recorded in the prior year
period.
- Invoiced Cloud revenue increased 6.8% year-over-year to $37.8
million in the third quarter. This non-GAAP measure is reconciled
within the financial statements below. This KPI is intended to
provide greater transparency in the underlying Cloud revenue trends
as it is not impacted by changes in deferred and unbilled
revenue.
- Quarterly recurring revenue was 83.7% of total revenue, a
decrease from 86.6% of total revenue in the second quarter and an
increase from 83.1% in the third quarter of last year.
- GAAP revenue breakdown by product is included below:
|
Q3 2022 vs Q3 2021 |
(in thousands) |
Q3 2022 Revenue |
|
Q3 2021 Revenue |
|
% Increase/ (Decrease) |
|
% of Total Q3 2022 Revenue |
Cloud |
$38,558 |
|
$43,124 |
|
(10.6 |
)% |
|
64.4 |
% |
Digital |
|
9,635 |
|
|
14,365 |
|
(32.9 |
)% |
|
16.1 |
% |
Messaging |
|
11,703 |
|
|
12,264 |
|
(4.6 |
)% |
|
19.5 |
% |
|
$59,896 |
|
$69,753 |
|
|
|
100.0 |
% |
Third Quarter 2022 Financial
Results:Results compare 2022 fiscal third quarter end
(September 30, 2022) to 2021 fiscal third quarter end (September
30, 2021) unless otherwise indicated.
- Total revenue
decreased 14% to $59.9 million from $69.8 million in the prior year
period. The decline in revenue was a result of expected deferred
revenue run-off in the current quarter, unfavorable foreign
exchange impact, the Company’s divestiture of the DXP and
Activation assets in the second quarter, and temporary slowdowns in
purchasing activity as a result of current macroeconomic
conditions. The FX impact to revenue in the third quarter totaled
approximately $1.8 million due to the strength of the U.S. Dollar
compared to the Euro and Japanese Yen. Negative impact from FX
year-to-date has been approximately $3.9 million.
- Gross profit
decreased 12% to $37.5 million (62.5% of total revenue) from $42.5
million (60.9% of total revenue) in the prior year period,
primarily attributable to the revenue shortfall previously noted
and the sale of the DXP and Activation assets. The increase in
gross margin was primarily attributable to increased revenue from
high-margin Cloud subscriber growth and ongoing benefits from cost
saving initiatives.
- Income (loss) from
operations was $1.3 million compared to a loss of $(10.5)
million in 2021. The improvement in operating income was a result
of increased high margin Cloud revenue, reduced SG&A expenses
and greater efficiency of R&D resources and other cost saving
initiatives.
- Net loss improved
to $(1.3) million, or $(0.01) per share, compared to net loss of
$(9.8) million, or $(0.11) per share, in the prior year period. The
significant improvement in net loss was primarily attributable to
operational improvements previously noted.
- Adjusted EBITDA (a
non-GAAP metric reconciled below) decreased 7% to $11.5 million
(19.1% of total revenue) from $12.3 million (17.6% of total
revenue) in the prior year period. The increase in adjusted EBITDA
margin was primarily attributable to the increased revenue from
high-margin Cloud subscriber growth and ongoing benefits from cost
saving initiatives previously noted. The decrease in adjusted
EBITDA resulted from lower revenues as previously outlined.
- Cash and cash
equivalents were $22.6 million at September 30, 2022,
compared to $25.5 million at June 30, 2022 and $31.5 million
at December 31, 2021. Free cash flow was $(0.7) million and
adjusted free cash flow was $2.8 million. The Company did not
receive additional tax refunds during the period, leaving its
remaining due balance at approximately $28 million, which is
expected to be paid out in the coming quarters.
Financial CommentaryCFO Lou
Ferraro added: “Free cash flow, on both an adjusted and unadjusted
basis, continues to demonstrate vast improvements year over year,
increasing $8.1 million and $6.6 million, respectively. As noted
previously, during the period we did experience a moderate slowing
of customer decision making activity in some areas of our business.
However, we believe these impacts to be temporary and in line with
the overall industry response to current macroeconomic headwinds.
Additional contributors to financial performance in the quarter
came from an expected $4.2 million run-off in deferred revenue, the
$2 million impact from the sale of the DXP and Activation assets
earlier this year, $1.8 million in unfavorable revenue impact from
foreign exchange, and slightly lower than anticipated cloud
subscriber growth. The Company’s progress in improving operations
continued, evidenced by an $11.8 million improvement to operating
income driven by a $21.7 million reduction in costs and expenses
during the period. Moreover, we’ve made significant headway against
net loss, already resulting in a roughly $55 million favorable
improvement through the first nine months of the year.”
2022 Financial OutlookCompared to the third
quarter of 2022, management expects fourth quarter revenue and
adjusted EBITDA to increase. Growth in the fourth quarter is
expected to come from continued strength in the Company’s Cloud and
Messaging businesses, layering growth from existing customers and
expected new customer agreements in the quarter.
The Company still expects to be free cash flow positive, on an
adjusted basis, for the year, and looking to 2023, the Company
reiterated that it expects to be free cash flow positive, on an
unadjusted basis, given the upward trajectory of its Cloud business
and the actions taken to drive down its cost structures.
Based on the financial performance in the first half of 2022 and
better visibility into the remainder of the year, the Company is
maintaining the range of its full year 2022 adjusted EBITDA
expectations to between $48.0 million and $55.0 million from a
previous range of $45.0 million to $55.0 million.
Additionally, the Company now expects GAAP revenue for the
fiscal year ending December 31, 2022, to be between $253.0 million
and $260.0 million from a previous range of $260.0 million to
$270.0 million. This revision was primarily the result of the $5.5
million annualized negative impact in FX and the delay in some
decision making due to the macroeconomic environment. The sales
pipeline remains healthy and subscriber growth continues to be
strong. After adjusting for the divestiture of the Company’s DXP
and Activation assets the comparable 2021 revenue is $265.0
million. Synchronoss is reiterating its projection for Cloud
subscriber growth to continue at a double-digit rate on a
year-over-year basis in 2022.
A reconciliation of GAAP to non-GAAP results has been provided
in the financial statement tables included in this press release.
An explanation of these measures is included below under the
heading "Non-GAAP Financial Measures."
Conference CallSynchronoss will hold a
conference call today, November 8, 2022, at 4:30 p.m. Eastern
time (1:30 p.m. Pacific time) to discuss these results.
Synchronoss management will host the call, followed by a
question-and-answer period.
Registration Link: Click here to register
Please register online at least 10 minutes prior to the start
time. Upon registration, the webcast platform will provide dial-in
numbers and a unique access code. If you have any difficulty with
registration or connecting to the conference call, please contact
Gateway Investor Relations at 949-574-3860.
The conference call will be broadcast live and available for
replay here and via the Investor Relations section of Synchronoss's
website.
Non-GAAP Financial Measures
Synchronoss has provided in this release selected financial
information that has not been prepared in accordance with GAAP
although this non-GAAP financial information is derived from
numbers that have been prepared in accordance with GAAP. This
information includes historical non-GAAP revenues, gross profit,
adjusted EBITDA, operating income (loss), net income (loss),
effective tax rate, and earnings (loss) per share. Synchronoss uses
these non-GAAP financial measures internally in analyzing its
financial results and believes they are useful to investors, as a
supplement to GAAP measures, in evaluating Synchronoss’ ongoing
operational performance. Synchronoss believes that the use of these
non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and
trends, and in comparing its financial results with other companies
in Synchronoss’ industry, many of which present similar non-GAAP
financial measures to investors. As noted, the non-GAAP financial
results discussed above add back fair value stock-based
compensation expense, acquisition-related costs, which include
restructuring and cease-use lease expense, litigation, remediation
and refiling costs and amortization of intangibles associated with
acquisitions.
Non-GAAP financial measures should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. Investors are
encouraged to review the reconciliation of these non-GAAP measures
to their most directly comparable GAAP financial measures as
detailed above. Investors are encouraged to also review the Balance
Sheet, Statement of Operations, and Statement of Cash Flow. As
previously mentioned, a reconciliation of GAAP to non-GAAP results
has been provided in the financial statement tables included in
this press release.
Forward-Looking StatementsThis
press release includes statements concerning Synchronoss and its
future expectations, plans and prospects that constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. For this purpose, any
statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. Without
limiting the foregoing, the words “may,” “should,” “expects,”
“plans,” “anticipates,” “could,” “intends,” “believes,” “potential”
or “continue” or other similar expressions are intended to identify
forward-looking statements. Synchronoss has based these
forward-looking statements largely on its current expectations and
projections about future events and financial trends that it
believes may affect its business, financial condition and results
of operations. These forward-looking statements speak only as of
the date of this press release and are subject to a number of
risks, uncertainties and assumptions including, without limitation,
risks relating to the Company’s ability to sustain or increase
revenue from its larger customers and generate revenue from new
customers, the Company’s expectations regarding expenses and
revenue, the sufficiency of the Company’s cash resources, the
impact of legal proceedings involving the Company, including the
investigations by the Securities and Exchange Commission and the
Department of Justice described in the Company’s most recent SEC
filings, and other risks and factors that are described in the
“Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” sections of the
Company’s Annual Report on Form 10-K for the year ended December
31, 2021, which is on file with the SEC and available on the SEC’s
website at www.sec.gov. The company does not undertake any
obligation to update any forward-looking statements contained in
this press release as a result of new information, future events or
otherwise.
About SynchronossSynchronoss Technologies
(Nasdaq: SNCR) builds software that empowers companies around the
world to connect with their subscribers in trusted and meaningful
ways. The company’s collection of products helps streamline
networks, simplify onboarding, and engage subscribers to unleash
new revenue streams, reduce costs and increase speed to market.
Hundreds of millions of subscribers trust Synchronoss products to
stay in sync with the people, services, and content they love.
Learn more at www.synchronoss.com.
Media Relations
Contact:Domenick
CileaSpringboarddcilea@springboardpr.com
Investor Relations Contact:
Matt Glover and Tom ColtonGateway Group, Inc.SNCR@gatewayir.com
-Financial Tables to Follow-
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
BALANCE SHEETS(Unaudited) (In
thousands)
|
|
September 30, 2022 |
|
December 31, 2021 |
ASSETS |
|
|
|
|
Cash and cash equivalents |
|
$ |
22,584 |
|
$ |
31,504 |
Accounts receivable, net |
|
|
45,903 |
|
|
47,586 |
Operating lease right-of-use assets |
|
|
21,471 |
|
|
26,399 |
Goodwill |
|
|
203,261 |
|
|
224,577 |
Other assets |
|
|
105,670 |
|
|
120,668 |
Total assets |
|
$ |
398,889 |
|
$ |
450,734 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Accounts payable and accrued expenses |
|
$ |
67,067 |
|
$ |
73,013 |
Deferred revenues |
|
|
15,002 |
|
|
22,916 |
Debt, non-current |
|
|
134,200 |
|
|
133,104 |
Operating lease liabilities, non-current |
|
|
30,725 |
|
|
36,095 |
Other liabilities |
|
|
5,482 |
|
|
9,778 |
Preferred stock |
|
|
68,348 |
|
|
72,505 |
Redeemable noncontrolling interest |
|
|
12,500 |
|
|
12,500 |
Stockholders’ equity |
|
|
65,565 |
|
|
90,823 |
Total liabilities and stockholders’ equity |
|
$ |
398,889 |
|
$ |
450,734 |
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(Unaudited) (In thousands,
except per share data)
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
revenues |
|
$ |
59,896 |
|
|
$ |
69,753 |
|
|
$ |
190,998 |
|
|
$ |
206,784 |
|
Costs
and expenses: |
|
|
|
|
|
|
|
|
Cost of revenues1 |
|
|
22,440 |
|
|
|
27,245 |
|
|
|
69,595 |
|
|
|
83,024 |
|
Research and development |
|
|
12,911 |
|
|
|
15,368 |
|
|
|
42,162 |
|
|
|
49,962 |
|
Selling, general and administrative |
|
|
15,338 |
|
|
|
27,953 |
|
|
|
48,523 |
|
|
|
67,790 |
|
Restructuring charges |
|
|
201 |
|
|
|
1,485 |
|
|
|
1,905 |
|
|
|
3,075 |
|
Depreciation and amortization |
|
|
7,726 |
|
|
|
8,215 |
|
|
|
24,019 |
|
|
|
26,567 |
|
Total costs and expenses |
|
|
58,616 |
|
|
|
80,266 |
|
|
|
186,204 |
|
|
|
230,418 |
|
Income (loss) from operations |
|
|
1,280 |
|
|
|
(10,513 |
) |
|
|
4,794 |
|
|
|
(23,634 |
) |
Interest income |
|
|
20 |
|
|
|
24 |
|
|
|
230 |
|
|
|
54 |
|
Interest expense |
|
|
(3,463 |
) |
|
|
(2,933 |
) |
|
|
(10,131 |
) |
|
|
(3,172 |
) |
(Loss) gain on divestiture |
|
|
(73 |
) |
|
|
— |
|
|
|
2,549 |
|
|
|
— |
|
Other income (expense), net |
|
|
4,437 |
|
|
|
(1,669 |
) |
|
|
10,206 |
|
|
|
(3,489 |
) |
Income (loss) from operations, before taxes |
|
|
2,201 |
|
|
|
(15,091 |
) |
|
|
7,648 |
|
|
|
(30,241 |
) |
(Provision) benefit for income taxes |
|
|
(1,115 |
) |
|
|
6,982 |
|
|
|
(1,678 |
) |
|
|
7,346 |
|
Net
income (loss) |
|
|
1,086 |
|
|
|
(8,109 |
) |
|
|
5,970 |
|
|
|
(22,895 |
) |
Net (loss) income attributable to redeemable noncontrolling
interests |
|
|
(66 |
) |
|
|
— |
|
|
|
(256 |
) |
|
|
286 |
|
Preferred stock dividend |
|
|
(2,298 |
) |
|
|
(1,722 |
) |
|
|
(7,255 |
) |
|
|
(33,728 |
) |
Net
loss attributable to Synchronoss |
|
$ |
(1,278 |
) |
|
$ |
(9,831 |
) |
|
$ |
(1,541 |
) |
|
$ |
(56,337 |
) |
|
|
|
|
|
|
|
|
|
Earnings (loss) per share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.01 |
) |
|
$ |
(0.11 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.98 |
) |
Diluted |
|
$ |
(0.01 |
) |
|
$ |
(0.11 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.98 |
) |
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
86,400 |
|
|
|
85,646 |
|
|
|
86,156 |
|
|
|
57,662 |
|
Diluted |
|
|
86,400 |
|
|
|
85,646 |
|
|
|
86,156 |
|
|
|
57,662 |
|
________________________________1 Cost of revenues
excludes depreciation and amortization which are shown
separately.
SYNCHRONOSS
TECHNOLOGIES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS(Unaudited) (In
thousands)
|
Nine Months EndedSeptember 30, |
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) |
$ |
5,970 |
|
|
$ |
(22,895 |
) |
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
|
Non-cash items |
|
27,378 |
|
|
|
33,830 |
|
Changes in operating assets and liabilities |
|
(22,270 |
) |
|
|
(5,384 |
) |
Net cash provided by operating activities |
|
11,078 |
|
|
|
5,551 |
|
|
|
|
|
Investing activities: |
|
|
|
Purchases of fixed assets |
|
(1,021 |
) |
|
|
(1,386 |
) |
Purchases of intangible assets and capitalized software |
|
(15,250 |
) |
|
|
(17,004 |
) |
Other investing activities |
|
8,000 |
|
|
|
550 |
|
Net cash used in investing activities |
|
(8,271 |
) |
|
|
(17,840 |
) |
|
|
|
|
Net cash (used in) provided by financing
activities |
|
(10,975 |
) |
|
|
2,687 |
|
Effect of exchange rate changes on cash |
|
(752 |
) |
|
|
72 |
|
Net decrease in cash and cash equivalents |
|
(8,920 |
) |
|
|
(9,530 |
) |
|
|
|
|
Cash and cash equivalents,
beginning of period |
|
31,504 |
|
|
|
33,671 |
|
Cash and cash equivalents, end
of period |
$ |
22,584 |
|
|
$ |
24,141 |
|
SYNCHRONOSS
TECHNOLOGIES, INC.RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES(Unaudited) (In
thousands, except per share data)
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Non-GAAP financial measures and reconciliation: |
|
|
|
|
|
|
|
|
GAAP
Revenue |
|
$ |
59,896 |
|
|
$ |
69,753 |
|
|
$ |
190,998 |
|
|
$ |
206,784 |
|
Less: Cost of revenues |
|
|
22,440 |
|
|
|
27,245 |
|
|
|
69,595 |
|
|
|
83,024 |
|
Gross
Profit |
|
|
37,456 |
|
|
|
42,508 |
|
|
|
121,403 |
|
|
|
123,760 |
|
Add /
(Less): |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
|
232 |
|
|
|
432 |
|
|
|
592 |
|
|
|
1,289 |
|
Restructuring, transition and cease-use lease expense |
|
|
67 |
|
|
|
405 |
|
|
|
1,038 |
|
|
|
432 |
|
Adjusted Gross Profit |
|
$ |
37,755 |
|
|
$ |
43,345 |
|
|
$ |
123,033 |
|
|
$ |
125,481 |
|
Adjusted Gross Margin |
|
|
63.0 |
% |
|
|
62.1 |
% |
|
|
64.4 |
% |
|
|
60.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
GAAP
Net loss attributable to Synchronoss |
|
$ |
(1,278 |
) |
|
$ |
(9,831 |
) |
|
$ |
(1,541 |
) |
|
$ |
(56,337 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
|
1,801 |
|
|
|
2,289 |
|
|
|
4,692 |
|
|
|
7,355 |
|
Restructuring, transition and cease-use lease expense |
|
|
557 |
|
|
|
2,981 |
|
|
|
3,949 |
|
|
|
7,956 |
|
Amortization expense1 |
|
|
2,436 |
|
|
|
3,036 |
|
|
|
7,469 |
|
|
|
9,851 |
|
Litigation, remediation and refiling costs, net |
|
|
88 |
|
|
|
9,316 |
|
|
|
(227 |
) |
|
|
12,858 |
|
Non-GAAP Net income (loss) attributable to Synchronoss |
|
$ |
3,604 |
|
|
$ |
7,791 |
|
|
$ |
14,342 |
|
|
$ |
(18,317 |
) |
|
|
|
|
|
|
|
|
|
Diluted Non-GAAP Net income (loss) per share |
|
$ |
0.04 |
|
|
$ |
0.09 |
|
|
$ |
0.17 |
|
|
$ |
(0.32 |
) |
|
|
|
|
|
|
|
|
|
Weighted shares outstanding - Dilutive |
|
|
86,400 |
|
|
|
85,646 |
|
|
|
86,156 |
|
|
|
57,662 |
|
___________________________1
Amortization from acquired intangible assets.
SYNCHRONOSS
TECHNOLOGIES, INC.RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES(Unaudited) (In
thousands)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
Sep 30, 2022 |
|
Jun 30, 2022 |
|
Mar 31, 2022 |
|
Dec 31, 2021 |
|
Sep 30, 2021 |
|
Sep 30, 2022 |
|
Sep 30, 2021 |
Net income (loss) attributable to Synchronoss |
|
$ |
(1,278 |
) |
|
$ |
5,327 |
|
|
$ |
(5,590 |
) |
|
$ |
(2,114 |
) |
|
$ |
(9,831 |
) |
|
$ |
(1,541 |
) |
|
$ |
(56,337 |
) |
Add /
(Less): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
|
1,801 |
|
|
|
964 |
|
|
|
1,927 |
|
|
|
1,950 |
|
|
|
2,289 |
|
|
|
4,692 |
|
|
|
7,355 |
|
Restructuring, transition and cease-use lease expense |
|
|
557 |
|
|
|
1,381 |
|
|
|
2,011 |
|
|
|
2,286 |
|
|
|
2,981 |
|
|
|
3,949 |
|
|
|
7,956 |
|
Litigation, remediation and refiling costs, net |
|
|
88 |
|
|
|
(1,292 |
) |
|
|
977 |
|
|
|
(30 |
) |
|
|
9,316 |
|
|
|
(227 |
) |
|
|
12,858 |
|
Depreciation and amortization |
|
|
7,726 |
|
|
|
8,259 |
|
|
|
8,034 |
|
|
|
9,498 |
|
|
|
8,215 |
|
|
|
24,019 |
|
|
|
26,567 |
|
Interest income |
|
|
(20 |
) |
|
|
(118 |
) |
|
|
(92 |
) |
|
|
15 |
|
|
|
(24 |
) |
|
|
(230 |
) |
|
|
(54 |
) |
Interest expense |
|
|
3,463 |
|
|
|
3,343 |
|
|
|
3,325 |
|
|
|
3,248 |
|
|
|
2,933 |
|
|
|
10,131 |
|
|
|
3,172 |
|
Loss (gain) on divestiture |
|
|
73 |
|
|
|
(2,622 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2,549 |
) |
|
|
— |
|
Other (income) expense, net |
|
|
(4,437 |
) |
|
|
(4,065 |
) |
|
|
(1,704 |
) |
|
|
1,388 |
|
|
|
1,669 |
|
|
|
(10,206 |
) |
|
|
3,489 |
|
Provision (benefit) for income taxes |
|
|
1,115 |
|
|
|
435 |
|
|
|
128 |
|
|
|
169 |
|
|
|
(6,982 |
) |
|
|
1,678 |
|
|
|
(7,346 |
) |
Net loss (income) attributable to noncontrolling interests |
|
|
66 |
|
|
|
75 |
|
|
|
115 |
|
|
|
130 |
|
|
|
— |
|
|
|
256 |
|
|
|
(286 |
) |
Preferred dividend1 |
|
|
2,298 |
|
|
|
2,519 |
|
|
|
2,438 |
|
|
|
1,781 |
|
|
|
1,722 |
|
|
|
7,255 |
|
|
|
33,728 |
|
Adjusted EBITDA (non-GAAP) |
|
$ |
11,452 |
|
|
$ |
14,206 |
|
|
$ |
11,569 |
|
|
$ |
18,321 |
|
|
$ |
12,288 |
|
|
$ |
37,227 |
|
|
$ |
31,102 |
|
___________________________1
Includes $10.4 million preferred stock amortization
costs accelerated due to Series A Preferred stock redemption in the
second quarter of 2021.
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
Cash provided by (used in) operating activities |
|
$ |
4,350 |
|
|
$ |
(2,616 |
) |
|
$ |
11,078 |
|
|
$ |
5,551 |
|
Add /
(Less): |
|
|
|
|
|
|
|
|
Capitalized software |
|
|
(4,555 |
) |
|
|
(6,045 |
) |
|
|
(15,250 |
) |
|
|
(17,004 |
) |
Property and equipment |
|
|
(448 |
) |
|
|
(136 |
) |
|
|
(1,021 |
) |
|
|
(1,386 |
) |
Free
Cashflow |
|
|
(653 |
) |
|
|
(8,797 |
) |
|
|
(5,193 |
) |
|
|
(12,839 |
) |
Add: Litigation and remediation costs, net |
|
|
2,030 |
|
|
|
3,304 |
|
|
|
2,704 |
|
|
|
4,045 |
|
Add: Restructuring |
|
|
1,457 |
|
|
|
1,694 |
|
|
|
5,890 |
|
|
|
6,203 |
|
Adjusted Free Cashflow |
|
$ |
2,834 |
|
|
$ |
(3,799 |
) |
|
$ |
3,401 |
|
|
$ |
(2,591 |
) |
SYNCHRONOSS
TECHNOLOGIES, INC.RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES(Unaudited) (In
thousands)
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
GAAP Cloud Revenue |
|
$ |
38,558 |
|
|
$ |
43,124 |
|
|
$ |
123,536 |
|
|
$ |
120,911 |
|
Increase / (Decrease) Change
in Deferred Revenue |
|
|
61 |
|
|
|
(4,224 |
) |
|
|
(7,660 |
) |
|
|
(14,424 |
) |
(Increase) / Decrease: Change
in Unbilled Receivables & Contract Assets |
|
|
(869 |
) |
|
|
(3,548 |
) |
|
|
(4,706 |
) |
|
|
(3,356 |
) |
Invoiced Cloud Revenue |
|
$ |
37,750 |
|
|
$ |
35,352 |
|
|
$ |
111,170 |
|
|
$ |
103,131 |
|
Invoiced Cloud Revenue is defined as GAAP
revenue for Cloud disaggregated revenue stream, plus the period
change in deferred revenue balance related to the Cloud revenue
stream, less the period change in Unbilled Receivables and Contract
Assets balance related to the Cloud revenue stream.
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