A day after a report of a big rise in earnings and a big fall in share price, film- and video-editing company Avid Technologies rebounded massively, with its stock price jumping 15.8% to $44.23 per share.
The rise of more than $6 per share Friday came a day after the company’s strong earnings report for the second quarter ended June 30 was accompanied by a 4.9% drop in share price to $38.20.
That came despite results showing quarterly revs were up $7 million to $113 million, gross margins widened to 55% and cash on hand rose $29 million to $135 million.
Overall, the company reported net quarterly income of $7.8 million, or 25¢ a share, compared with a year ago, when it eked out just $152,000, or a penny a share, in profit. The results also far outstripped analyst estimates of 17¢ a share.
Avid’s buffed-up bottom line came in the midst of rolling out several products designed to appeal to every part of its customer base. These range from improved bottom-end editing software that costs less than $2,000 to full editing suites of software and hardware that cost more than $100,000.
During the second quarter, for instance, it shipped the first of its new Media Composer Adrenaline and NewsCutter Adrenaline FX systems, selling more than 800 units of the pricey Media Composer suites.
The new products are signs of a revived Avid, which has struggled in recent years from stiff competition in the nonlinear editing business.
Posing the biggest threat has been Apple Computer, whose $1,000 Final Cut Pro editing software has eroded Avid’s base among indie and docu filmmakers, and other prosumer and professional film and videomakers. Final Cut is even being used by some major post-production facilities, though Avid’s high-end editing suites remain the technology of choice for editing most major features.
The latest results indicate Avid indeed still has avid customers, in TV news as well as movies. Company said it had received another 23 orders during the quarter for its end-to-end packages of hardware and software used in broadcast newsrooms for editing, bringing to 110 the number of those systems it has sold in the past 30 months.