Synchronoss Technologies Inc. (SNCR) filed Quarterly Report for the period ended 2009-09-30.
SYNCHRONOSS TECHNOLOGIES is the premier provider of on-demand transaction management software to Tier One communications service providers. Synchronoss enables service providers to drive growth in new and existing markets while delivering an improved customer experience at lower costs. The company's flagship ActivationNow and ConvergenceNow software platforms automate synchronize and simplify electronic service creation and management of advanced wireline wireless and IP services across existing networks. Synchronoss Technologies Inc. has a market cap of $403.7 million; its shares were traded at around $13.02 with a P/E ratio of 37.2 and P/S ratio of 3.6.
Highlight of Business Operations:
Net Revenue. Net revenues increased $6.8 million to $33.1 million for the three months ended September 30, 2009, compared to the three months ended September 30, 2008. This increase was due primarily to increased revenues from our AT&T relationship and our other customers. Net revenues related to AT&T increased $4.7 million to $22.2 million for the three months ended September 30, 2009 compared to the same period in 2008. This increase was primarily due to increased revenues associated with the expansion of our relationship with AT&T across new business channels. AT&T represented 67% and 66% of our revenues for the three months ended September 30, 2009 and 2008, respectively. Net revenues outside of AT&T generated $10.9 million of our revenues during the three months ended September 30, 2009 as compared to $8.9 million during the three months ended September 30, 2008. Net revenues outside of AT&T represented 33% and 34% of our revenues during the three months ended September 30, 2009 and 2008, respectively. Transaction revenues recognized for the three months ended September 30, 2009 and 2008 represented 83% or $27.5 million and 80% or $21.0 million of net revenues, respectively. Professional service revenues decreased as a percentage of sales to 16% or $5.4 million for the three months ended September 30, 2009, compared to 18% or $4.7 million for the previous three months ended September 30, 2008.
Cost of Services. Cost of services increased $3.2 million to $16.8 million for the three months ended September 30, 2009, compared to the three months ended September 30, 2008, due primarily to an increase of $1.4 million in personnel and related costs and an increase of $186 thousand in stock-based compensation. The increase in personnel and related costs was due primarily to an increase in headcount. In addition, there was an increase of $461 thousand in telecommunication and facility costs related to the transition to our new facility. There was an increase of $1.1 million for outside consultants related to new programs with existing customers. Cost of services as a percentage of revenues decreased to 50.7% for the three months ended September 30, 2009, as compared to 51.4% for the three months ended September 30, 2008.
Net Revenue. Net revenues increased $13.4 million to $93.2 million for the nine months ended September 30, 2009, compared to the nine months ended September 30, 2008. This increase was primarily due to increased revenues from existing customers. Net revenues related to AT&T increased $6.1 million to $60.8 million for the nine months ended September 30, 2009, as compared to $54.7 million during the nine months ended September 30, 2008. AT&T represented 65% and 69% of our revenues for the nine months ended September 30, 2009 and 2008, respectively. Net revenues outside of AT&T increased $7.4 million to $32.4 million during the nine months ended September 30, 2009 as compared to $25.0 million during the nine months ended September 30, 2008. Net revenues outside of AT&T represented 35% and 31% of our revenues during the nine months ended September 30, 2009 and 2008, respectively. Transaction revenues recognized for the nine months ended September 30, 2009 and 2008 represented 84% or $77.8 million and 82% or $65.4 million of net revenues, respectively. Professional service revenues as a percentage of sales were 16% or $14.7 million for the nine months ended September 30, 2009, compared to 16% or $13.1 million for the nine months ended September 30, 2008.
Cost of Services. Cost of services increased $8.4 million to $47.2 million for the nine months ended September 30, 2009, compared to the nine months ended September 30, 2008, due primarily to an increase of $3.7 million in personnel and related costs and an increase of $544 thousand in stock-based compensation. The increase in personnel and related costs was due primarily to an increase in headcount. In addition, there was an increase of $1.0 million in telecommunication and facility costs related to the transition to our new facility. There was an increase of $3.1 million for outside consultants related to new programs with existing customers. Cost of services as a percentage of revenues increased to 50.6% for the nine months ended September 30, 2009, as compared to 48.7% for the nine months ended September 30, 2008.
Selling, General and Administrative. Selling, general and administrative expense increased $2.1 million to $17.2 million for the nine months ended September 30, 2009, compared to the nine months ended September 30, 2008, due primarily to an increase of $1.4 million in personnel and related costs and an increase in stock-based compensation expense of $389 thousand offset by a decrease of $293 thousand in consulting service costs. The increase in personnel and related costs was primarily due to an increase in headcount offset by reduced use of outside consultants. Also, legal and accounting professional services increased approximately $432 thousand and additional telecommunication, and facility expenses related to our data facilities, contributed approximately $264 thousand to the increase. Selling, general and administrative expense as a percentage of revenues decreased to 18.5% for the nine months ended September 30, 2009, as compared to 18.9% for the nine months ended September 30, 2008.
Cash flows from operations. Net cash provided by operating activities for the nine months ended September 30, 2009 was $17.0 million, as compared to $18.1 million for the nine months ended September 30, 2008. The decrease of $1.0 million is primarily due to an increase in accounts receivable of $3.3 million offset by an increase in deferred revenue of $1.2 million, as compared to the nine months ended September 30, 2008.
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