Shares of Avid Technology (NASDAQ:AVID) have skyrocketed today, up by 26% as of 11:45 a.m. EST, after the company reported fourth-quarter earnings results. The multimedia technology provider swung to a profit and reaffirmed its 2019 guidance.
Revenue in the fourth quarter rose 5% to $112.7 million, while non-GAAP gross margin expanded by nearly 5 full percentage points to 60.8%. Software revenue from subscriptions jumped 77%, and e-commerce sales increased over 50%. That all translated into net income of $5.9 million, or $0.14 per share, compared to a net loss of $0.02 per share a year ago. Adjusted EBITDA was $21.3 million, and free cash flow was $17.7 million.
"Our return to revenue growth and the improvement in our key financial metrics, including Free Cash Flow and Adjusted EBITDA, demonstrate an improving business profile for our Company," CEO Jeff Rosica said in a statement. "Additionally, the management team is focused on continuing to build upon a scalable recurring revenue model as evidenced by our double-digit growth in subscriptions and e-commerce revenue."
"Throughout 2018, Avid continued to make gains in improving upon our strategy to become faster and more efficient at innovating and delivering on our product portfolio," Rosica added on the earnings call. "We have followed through on making available differentiated platforms, tools, and solutions that begin to factor into our 2018 results and also will help us drive our 2019 performance."
In terms of guidance, first-quarter revenue is expected in the range of $96 million to $104 million, with adjusted EBITDA of $7 million to $12 million. Full-year 2019 revenue is forecast to be $420 million to $430 million, with adjusted EBITDA of $60 million to $65 million and free cash flow of $12 million to $17 million.