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Envivio Inc (ENVI)
Q4 2013 Earnings Call
March 26, 2013 05:00 pm ET
Cynthia Hiponia - IR
Julien Signès - President, CEO, co-Founder
Erik Miller - Chief Financial Officer
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I would now like to turn the conference over to Cynthia Hiponia, Investor Relations. Please go ahead.
Thank you, Elisa. Good afternoon and welcome to Envivio's fourth quarter and full year fiscal 2013 financial results conference call. Joining the call today are Julien Signès, President and CEO, and Erik Miller, Chief Financial Officer.
The agenda for today's call include commentary from Julien followed by a discussion of the financial results from Erik. This afternoon in Envivio issued a press release announcing its fourth quarter and full fiscal year financial results, which is available on our company's website at envivio.com. This call is being rebroadcast live over the internet and the audio of this call will be available on the Investor Relations page of the company's website.
I'd like to remind everyone that this conference call will contain forward-looking statements that are not historical facts, but rather are based on the company's expectations and beliefs. Such forward looking statements are not a guarantee of performance and Envivio's actual results may differ materially from these forward looking statements.
Several factors that could cause or contribute to such differences are described in detail in the Risk Factors and other sections of our SEC filings as well as in our earnings release. Envivio undertakes no obligation to publicly release or otherwise disclose the results of any revision to these forward looking statements that may be made as a result of the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
In addition, today's discussion includes non-GAAP financial measures that Envivio believes may be important to investors as a metric to assess the operating performance of its business. Reconciliation to the most directly comparable GAAP financial measures are included in a table attached to the earnings release on the Envivio website.
And now I would like to introduce Julien Signès.
Thank you, Cynthia. Joining me on today's call is Erik Miller, Envivio's Chief Financial Officer.
Revenue for the fourth fiscal quarter was $7.7 million, up 7%, sequentially, and down 50% year-over-year. While we continued to see the impact of a weak spending environment, we are pleased to see a slight improvement in revenue over the prior quarter. As you recall, in both, the second and third fiscal quarters Envivio business was impacted by a slowdown in spending by our service providers due to both, a weak macro environment and an industry pause in multi-screen deployments. Another factor that impacted our business in fiscal 2013 are the disappointing sales execution in North America, where we did not have adequate sales coverage to capitalize on sales opportunity.
For the full fiscal 2013, revenue in the Americas was down 58% year-over-year. As a result, our focus has been on the rebuilding of our North American sales organization with a right coverage and depth.
Let me update you on our progress here. On our last earnings call in early December, we announced the hiring of a new VP of Sales for North and Latin America, David Baranski brought a strong industry background in cable, telecom and broadcast having worked in such companies as Cheetah Technologies, Terayon Communications, Advent Networks and 3Com.
Continuing to add trends to our sales organization in late January, we announced Ira Goldfarb as our new Senior Vice President of Global Sales and Service. Ira joined us from SeaChange International, where he was Executive Vice President of Worldwide Sales and Service. Ira brings extensive relationships with a Tier-1 North American customers and a deep understanding of the technology and markets.
We believe that our ability to continue to attract industry veterans such as Ira and David, speaks well of Envivio technology leadership and reputation in the marketplace. Another leadership of Ira and David, we hired three new sales executives, veterans of the industry, covering North America and U.S. cable in particular. We have also signed new sales partners in Latin America and Canada to expand our depth in these regions.
While our lack of sales coverage in fiscal 2013 contributed to missed opportunities in North America, we believe that the significant changes we made to our sales organization should provide us with positive momentum as we enter fiscal 2014.
As delays in the multi-screen deployments continue to negatively impact spending of our service provider customers and other area of focus that Envivio two quarters ago is selling our solutions into the broader pay TV video proxy markets. We believe Envivio as a competitor differentiator when it comes to these opportunities, thanks to our disruptive sales force strategy.
One example of a customer in the pay TV market, during the fourth quarter includes Totalplay Telecomunicaciones, a cable and IPTV service provider in Mexico Muse encoders, we're deployed for its live and on-demand video services in order to extend that channel lineup and improve video quality while reducing space requirement in the headends.
Another example is with Wasu Media Group in China. Wasu will deploy our Muse transcoders on the 4Caster appliance for its cable service to over 800,000 homes. Converged architecture and easily upgradable software and Wasu to optimize traditional TV services today and multi-screen environment in the near future, additional customer highlight during the fourth quarter includes, we won a significant new customer with a transaction value of a over $1 million in the Middle East is placing a legacy vendor in selling a converged TV and multi-screen headends. We will recognize the revenue for the transaction over time.