Synacor touts new OTT business, narrowing Q3 losses

Synacor said a "regional, full-service communications provider" has purchased its end-to-end video product in order to launch an in-home streaming service.

The Buffalo, N.Y.-based tech company didn't reveal the client. But the new business adds momentum for Synacor, which struggled through heavy losses and board-room dissension through much of the past few years.

During its third-quarter earnings call late last week, Synacor reported a 1 percent increase in quarterly revenue to $26.4 million. The company's quarterly losses improved to $900,000 from $2.6 million.

"Multiplatform video continues to be an important area of focus for our customers, and we're excited that we will be making additional customer announcements in the coming months," Synacor CEO Himesh Bhise told investors on the company's call, according to a Seeking Alpha transcript of the event.

Synacor has previously announced partnerships with Charter Communications (NASDAQ: CHTR) and CenturyLink, both of which are in trials with streaming-based pay-TV services. The technology company also counts Verizon (NYSE: VZ), Cable One, Suddenlink, Grande Communications and WideOpenWest as clients.

In addition to multiscreen services, Bhise said Synacor is also gaining momentum from its recent acquisition of email and messaging services provider Zimbra. 

"The acquisition of Zimbra creates meaningful cost and revenue synergies," he said. "It will extend Synacor's leadership in ISP solutions, will accelerate our stated strategy to expand in international and enterprise markets, and will strengthen Synacor's financial profile and competitiveness."

The company's advertising business, meanwhile, saw a 17 percent increase in quarterly revenue to $12 million. "We saw growth in CPMs driven by disciplined sales, a more valuable portfolio of advertising inventory and smart at operations," Bhise added. 

The slow warming of Synacor's financials doesn't seem to be restoring investor faith in the immediate term. Shares of Synacor -- which zenithed in July 2012 at over $16 a share -- were trading at $1.42 as of this morning. 

For more:
- read this Synacor earnings release
- read this Seeking Alpha transcript
- read this Multichannel News story

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