Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Synchronoss Technologies Inc. Soared Today

By Timothy Green - May 6, 2016 at 12:08PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

An across the board earnings beat and strong guidance propelled the mobile device activation software company higher.

Image Source: Synchronoss Technologies.

What: Shares of mobile device activation software provider Synchronoss Technologies (SNCR -0.43%) jumped on Friday following the company's first-quarter report. Synchronoss beat analyst estimates across the board, leading the stock about 15% higher by 10:45 a.m. EST.

So what: Synchronoss reported quarterly non-GAAP revenue of $145.6 million, up 9.4% year over year and about $1.3 million higher than analysts were expecting. Cloud services revenue grew 18% year over year to $84.3 million, representing about 58% of total non-GAAP revenue.

Non-GAAP earnings came in at $0.49 per share, flat year over year but $0.03 higher than the average analyst estimate. On a GAAP basis, the company reported a $0.17 per-share loss, down from a $0.23 per-share gain during the prior-year period. The loss was driven by acquisition-related costs of about $12.5 million.

Synchronoss expects its revenue growth to accelerate during the second quarter, with the company's guidance calling for 14% year-over-year non-GAAP revenue growth at the midpoint of its range of $155 million to $160 million. Cloud revenue is expected between $92 million and $95 million, growth of 30% at the midpoint. Non-GAAP EPS is expected between $0.51 and $0.55.

Now what: It was all good news for Synchronoss, and despite the company not expecting a major uplift from new smartphone launches this year, a strong pipeline gives the company the confidence to expect activation growth this year. CEO Stephen G. Waldis elaborated: "Cloud services were robust this quarter, as increasing subscriber growth on our core customer base is laying the groundwork for incremental cloud opportunities both domestically and internationally over the next 12 to 18 months. We have a proven history of executing, launching, and scaling new offerings and leveraging technology opportunities into something that becomes much bigger as we have exhibited to our customers, partners, and investors over the years."

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Synchronoss Technologies, Inc. Stock Quote
Synchronoss Technologies, Inc.
$1.16 (-0.43%) $0.01

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.