SeaChange falls short as 4Q revenues take a hit

Interactive TV technology provider SeaChange’s fourth quarter revenues have fallen dramatically below expectations thanks to delays in orders from the Americas.

Fourth quarter revenues to January 31 are expected to be in the range of US$34.5 million (€25.1 million) to US$35.5 million against expectations of US$40 to US$45 million as a result.

“We are very disappointed that fourth quarter revenues came in below our guidance range,” said Raghu Rau, CEO, SeaChange.

“The primary reasons for this shortfall were delays in receiving anticipated orders from customers in the Americas along with continued delays in receiving some final acceptances. The magnitude of these delays was greater than expected, given our customer concentration and the timing of our sales, wherein many sales occur towards the end of a quarter.”

Rau said that missed customer acceptances in the fourth quarter are expected to be received in the first half of fiscal 2015, while a majority of the delayed orders will be confirmed in fiscal 2015.

“Despite the short-term challenges, we remain encouraged by the continued market traction for our new products, which accounted for over two-thirds of our total product revenue in the fourth quarter, and the new opportunities in front of us,” said Rau.

“However, we continue to expect that fiscal 2015 will be a transitional year for SeaChange.”

He said the company expects revenue to grow in the second half of fiscal 2015 and remain flat or down for the full year relative to its anticipated fiscal 2014 performance. He said the company should nevertheless achieve higher profitability through cost reductions and increases in new product revenues.