Shares of Avid Technology (NASDAQ:AVID) jumped on Tuesday after the technology provider for the media and entertainment industry reported its second-quarter results. While revenue declined, the company beat analyst expectations across the board. The stock was up about 9.8% at 1:20 p.m. EDT.
Avid reported second-quarter revenue of $79.3 million, down 19.7% year over year but about $1.9 million higher than the average analyst estimate. Subscription revenue soared 68.3% to $16.4 million, driven by an increase of 24,000 paid subscriptions to around 242,000.
The revenue decline was primarily due to the COVID-19 pandemic, which "has caused the postponement or cancellation of many live music and major sporting events, and the temporary suspension of many film and television productions."
Non-GAAP (adjusted) earnings per share came in at $0.12, up from $0.02 in the prior-year period and $0.14 better than analysts were expecting. Avid slashed operating costs by 19.6% on a year-over-year basis, with the largest cuts coming from marketing and selling expenses.
"We are adjusting our strategy and our investments to respond to the changes in the market which are informed by ongoing discussions with customers across the media industry, placing greater focus on the products and solutions that we believe will drive profitable growth as we emerge in the post-COVID environment," said Avid CEO and president Jeff Rosica.
With Tuesday's rally, shares of Avid are now down only slightly since the start of the year.