Posts Tagged ‘MainConcept’

NeuLion Grows 2015 Revenue by 69%

Analysis, Broadcast technology vendor financials, Quarterly Results | Posted by Josh Stinehour
Mar 11 2016

NeuLion, a technology product and service provider for digital distribution, announced Q4 2015 and full year 2015 financial results.

2015 GAAP revenue was $94.0 million, a 69% increase versus 2014 revenue.  The January 2015 acquisition of DivX contributed approximately 73% of the year-over-year increase in GAAP revenue.

Commenting on NeuLion’s organic growth in Q4 2015, CEO Kanaan Jemili stated, “Revenue from our NeuLion Digital Platform grew 20% on new customer additions and expanded usage from existing customers.”

Net Income for the full year 2015 was $25.9 million versus $3.6 million for 2014.  The sharp increase in 2015 net income was primarily attributable to a $31.2 million income tax benefit recognized during Q4 2015.

Gross margins (exclusive of depreciation and amortization) were 81% for 2015, an increase over the 75% gross margins from 2014.  Kanaan Jemili attributed the margin improvement to further scale in NeuLion’s Digital Platform business and the addition of revenue streams from the acquisition of DivX.

Operating income for 2015 was negative $1.86 million, which compares to positive $3.5 million during 2014.

Selling, general and administrative (“SG&A”) expenses were $45.6 million for the 2015, an increase of 68.6% versus 2014.  SG&A expense as a percentage of revenue was 48.5% for 2015, flat when compared to 2014 levels.

Research and development (“R&D”) expense was $24.9 million for the full year, an almost tripling (197%) of R&D expense versus $8.3 million in 2014.  R&D expense represented 26.5% of 2015 revenue, in comparison to 15.1% in 2014.  The increase in R&D expense was almost entirely attributable to additional headcount from the acquisition of DivX.

Cash and cash equivalents ended the year at $53.4 million.  This compares to a cash balance of $25.8 million at the end of 2014.  Positive changes in working capital accounts contributed $18.3 million to the increase in cash.

NeuLion had 638 total employees (504 full time) as of February 29, 2016.  This is down from the 767 total employees (567 full-time) as of March 1, 2015.

Q4 2015 Results:

NeuLion’s Q4 2015 GAAP Revenue was $27.8 million, a 68% increase compared to Q4 2014.

Net income for the fourth quarter was $32.8 million versus $1.6 million for Q4 2014.

Gross margins for Q4 2015 were 81%, an improvement versus the 75% gross margins in Q4 2014.  The 600 basis point increase was primarily the result of the addition of revenues from DivX and improved operating costs for NeuLion Digital Platform.

Q4 2015 operating income was $1.7 million, a slight decrease of 2.3% versus Q4 2014.  Operating margins for the quarter were 6.3%, compared to 10.9% in Q4 2014.

SG&A expense for Q4 2015 was $13.2 million, a 65% increase versus Q4 2014.  R&D expense was $5.5 million during the fourth quarter, an increase of 161% when compared to Q4 2014.

Revenue by Service and Product Offerings:

  • NeuLion Digital Platform revenue was $66.1 million for 2015, an increase of 19% over 2014 revenue. For Q4 2015 GAAP revenue was $19.8 million, representing a 20% increase in year-over-year performance.
  • DivX and MainConcept product lines contributed GAAP revenue of $28.0 million for 2015. The product lines contributed GAAP revenue of $8.0 million for the fourth quarter of 2015.  Comparable periods are not available since the DivX and MainConcept product lines were acquired in January 2015.

 

Management Discussion and Analysis:

NeuLion’s earnings release highlighted several notable customer projects and related milestones.

Management called attention to the launch of Univision NOW, a new direct-to-consumer over-the-top service by Univision.  Univision NOW uses the NeuLion Digital Platform.  Other customer case studies mentioned were the delivery of multiple live NBA games in 4K with BT Sports and a 4K live stream of the national soccer teams of Mexico and Senegal from Miami (carried by Univision).

More broadly, NeuLion’s management reviewed key performance indicators of its Digital Platform including a 26% year-over-year increase in the number of live events and a 35% year-over-year increase in video traffic.

Separate to the earnings release, NeuLion announced a $10 million stock buyback.  The stock repurchase will occur over the next 12 months.  $10 million represents a meaningful percentage of NeuLion’s market cap, which is currently $264 million.

 

 

Related Content: 

NeuLion Press Release for 2015 Financial Results

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

2014 Big Broadcast Survey (BBS) Reports Now Available

broadcast industry technology trends, broadcast technology market research, Broadcast Vendor Brand Research, market research, Top Broadcast Vendor Brands | Posted by Joe Zaller
Jul 15 2014

After months of data collection, analysis, and visualization, we have now completed work on the 2014 Big Broadcast Survey (BBS). Reports from this study have now been published and are available from Devoncroft Partners.

If you’re not familiar with the BBS, it’s the most comprehensive annual study of technology end-users in the global broadcast industry. Nearly 10,000 broadcast professionals in 100+ countries participated in the 2014 BBS, making it once again the largest market study of the broadcast industry.

BBS reports have been designed to help readers improve their strategic decision-making, customer engagement, marketing strategy, product planning, and sales execution.  BBS reports are also used frequently for M&A-related activities by both buyers and sellers.

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Three types of 2014 BBS reports are available:

  • 2014 BBS Global Brand Reports:  provides deep insight into how each more than 100 broadcast technology suppliers (see full list below) are perceived by market participants, along with comprehensive benchmarking of broadcast technology vendors on a wide variety of metrics.

 

  • 2014 BBS Product Reports:  provide detailed information from buyers, specifiers, and users of broadcast technology products in 31 separate categories (see full list below)

 

  • 2014 BBS Global Market Report: provides detailed information about industry trends, major projects being planned, products being evaluated for purchase, current and future plant infrastructure, broadcast technology CapEx budgets, and planned deployment of new technologies including 4K, Connected TV, and Social TV.

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If you would like information about these reports and how they can help your business, please get in touch.

 

In addition to these paid-for reports, we will also be publishing highlights from the 2014 BBS on the Devoncroft website.  These articles will be posted on a semi-regular basis, so please check back often.

To receive posts when they are published, just enter your email in the box in the upper right-hand corner of the page.

 

The tables below show the product categories and broadcast technology vendor brands covered in the 2014 BBS.

 

 Product Categories Covered in the 2014 BBS:

2014 BBS -- Product Categories Covered in the 2014 Big Broadcast Survey

 

 

Broadcast Technology Brands Covered in the 2014 BBS:

 

2014 BBS -- All Brands included in 2014 BBS

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.© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Broadcast Vendor M&A: Rovi Sells DivX and MainConcept to Parallax Capital and StepStone Group for $75 Million

Broadcast Vendor M&A, SEC Filings | Posted by Joe Zaller
Apr 01 2014

Rovi has sold its DivX and MainConcept businesses to Parallax Capital Partners and StepStone Group in a cash and stock deal valued at up to $75m

Under the terms of the deal, Rovi will receive an initial payment of $52.5m, and may receive up to three earnout payments over the next three years that could add another $22.5m to the transaction price. Any earnout payments will be based on the achievement of upon certain milestones agreed by the parties in the transaction.

Rovi had previously its intention to sell the DivX and MainConcept before the end of the second quarter of 2014 as part of a strategic effort to focus on growth opportunities related to its core entertainment discovery technologies and services.

“The sale of DivX was the last of a number of significant steps we’ve taken over the past year to realign the organization for sustainable, long-term growth and I’m pleased we met our commitment to complete this transaction, and did so ahead of schedule,” said Thomas Carson, President and CEO, Rovi Corporation.

The sale price represents a significant drop in value for DivX, which was acquired by Sonic Solutions in June 2010 for $323m.  Less than six months later, Rovi acquired Sonic Solutions for $720m.  At that time, Rovi said the combination of Rovi and Sonic “will be able to power the next generation of digital entertainment offerings with content discovery, delivery, and enhanced interactivity capabilities that support advertising and drive consumer engagement.”

The transaction is expected to close by April 1, 2014.

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Related Content:

DivX Purchase Agreement

Press Release: Rovi Announces Sale of DivX and MainConcept Businesses

Press Release: Parallax Capital Partners and StepStone Group to Acquire DivX

Rovi to buy Sonic for $720 million

Sonic Solutions to buy DivX in $323M bid to become digital media leader

Sonic Solutions Integrates Newly Acquired MainConcept, Forms New Pro Technology Division

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Rovi Ends All Current Lawsuits Against LG, Licenses Patents for Use in All LG Products

Broadcast technology vendor financials, SEC Filings | Posted by Joe Zaller
Mar 04 2013

Electronic program guide technology provider Rovi disclosed through a regulatory filing that it has entered into a multi-year licensing agreement with LG Electronics for the use of its patent portfolio in “all LG products.”  Deal terms were not provided.

According to the filing, the new licensing agreement “includes the dismissal of all current lawsuits,” which presumably includes this complaint for patent infringement filed by Rovi against LG in May 2012 in the US District Court for Delaware.

The catalyst for the new arrangement between Rovi and LG may be the fact that LG recently won a patent infringement case filed by Rovi in German courts.

According to Korea Times article, Rovi filed for an injunction with the German court against LG Electronics in April 2012, to ban sales of its televisions, claiming LG has infringed on technology patents for its products.  The lawsuit came as LG Electronics rejected Rovi’s request to pay license fees for its patent. LG Electronics argued that the patent claimed by Rovi Corporation is irrelevant to its products, adding the U.S. firm’s stance on the scope of patent is “too broad.”

German Courts ruled in favor of LG in December 2012.

 

Re-Affirms Business Outlook

Rovi, which also owns Divx and codec provider MainConcept, used the filing to re-affirm its business outlook for 2013, saying that “while the settlement with LG was successfully achieved earlier in the company’s fiscal year 2013 than previously anticipated by the company, the company continues to expect the timing of adjusted pro forma revenue to be approximately 47% and 53% in the first and second halves of 2013, respectively.”

Rovi says it expects its adjusted pro-forma revenue for 2013 to be between $630m and $660m, and adjusted pro-forma income per common share to be between $1.90 and $2.20, excluding discontinued operations.  The company also said its revenue expectations for the fiscal first quarter, ending March 31, 2013, are unchanged from previously issued guidance.

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Related Content:

Rovi SEC Filing: Discloses LG Patent Licensing Agreement, and Dismissal of all Current Lawsuits

Korea Times Article: LG defeats patent infringement claims in German court

Rovi Complaint for Patent Infringement against LG Electronics, Delaware District Court May 2012

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© Devoncroft Partners. All Rights Reserved.

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Sonic Solutions Integrates Newly Acquired MainConcept, Forms New Pro Technology Division

Broadcast Vendor M&A | Posted by Joe Zaller
Oct 18 2010

Sonic Solutions announced today that it has formed a new professional technology division, which combines newly acquired MainConcept with Sonic’s existing professional products group.  MainConcept was previously a subsidiary of DivX, whose acquisition by Sonic was finalized earlier this month.   

Sonic, who also owns the Roxio brand, says that with the integration of MainConcept, it can now offer an expanded ‘one-stop-shop’ for companies that are looking to incorporate media management technologies into their products and services.

Because MainConcept’s codec technologies are widely deployed by a wide variety of broadcast technology vendors for ingest and transcoding applications the move brings Sonic into the professional broadcast market.  The company its new division will offer a broad range of products including authoring technologies, codec engines and a variety of SDKs.

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You can read the full Sonic press release about the integration of MainConcept here

You can read the full Sonic press release about the finalization of the DivX acquisition here

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