Brightcove Announces Financial Results for Second Quarter 0

Brightcove Announces Financial Results for Second Quarter 2013 July 25, 2013 / Brightcove Press Release

BOSTON, MA (July 25, 2013) Brightcove Inc. (NASDAQ: BCOV), a leading global provider of cloud content services, today announced financial results for the quarter ended June 30, 2013.

"Brightcove delivered strong second quarter results highlighted by revenue and profitability that exceeded the high end of our guidance," said David Mendels, Chief Executive Officer of Brightcove. "We are seeing strong demand across a wide variety of industries as our customers embrace the use of digital content as a way to drive deeper levels of engagement with their customers. During the quarter we delivered exciting new technology to the market that enhances our market leadership position and strengthens our ability to penetrate the multi-billion dollar online video platform market."

Second Quarter 2013 Financial Highlights:

Revenue: Total revenue for the second quarter of 2013 was $26.9 million, an increase of 24% compared to $21.6 million for the second quarter of 2012. Subscription and support revenue was $25.6 million, an increase of 23% compared with $20.7 million for the second quarter of 2012. Professional services and other revenue was $1.3 million, compared to $902,000 for the second quarter of 2012.

Gross Profit: Gross profit for the second quarter of 2013 was $17.7 million, compared to $15.2 million for the second quarter of 2012, and gross margin was 66% for the second quarter of 2013. Non-GAAP gross profit for the second quarter of 2013 was $18.1 million, representing a year-over-year increase of 18% and a non-GAAP gross margin of 67%. Non-GAAP gross profit and non-GAAP gross margin exclude stock-based compensation expense and the amortization of acquired intangible assets.

Loss from Operations: Loss from operations was $3.3 million for the second quarter of 2013, compared to a loss of $3.9 million for the second quarter of 2012. Non-GAAP loss from operations, which excludes stock-based compensation expense, the amortization of acquired intangible assets and merger-related expenses, was $874,000 for the second quarter of 2013, compared to a non-GAAP loss from operations of $2.1 million during the second quarter of 2012.

Net Loss: Net loss attributable to common stockholders was $3.5 million, or $0.12 per basic and diluted share, for the second quarter of 2013. This compares to a net loss attributable to common stockholders of $4.3 million, or $0.16 per basic and diluted share, for the second quarter of 2012.

Non-GAAP net loss attributable to common stockholders, which excludes stock-based compensation expense, the amortization of acquired intangible assets, merger-related expenses, and the accretion of dividends on redeemable convertible preferred stock, was $1.1 million for the second quarter of 2013, or $0.04 per basic and diluted share, compared to a non-GAAP net loss attributable to common stockholders of $2.6 million for the second quarter of 2012, or $0.10 per basic and diluted share.

Balance Sheet and Cash Flow: As of June 30, 2013, Brightcove had $30.5 million of cash, cash equivalents and investments, compared to $28.6 million at March 31, 2013. Brightcove generated $2.8 million in cash from operations and invested $802,000 in capital expenditures, leading to free cash flow of $2.0 million for the second quarter of 2013. Free cash flow was ($2.1) million for the second quarter of 2012.

A Reconciliation of GAAP to Non-GAAP results has been provided in the financial statement tables included at the end of this press release. An explanation of these measures is also included below under the heading Non-GAAP Financial Measures.

Other Second Quarter and Recent Highlights

Yahoo!7, a leading online destination for Australian consumers and advertisers, chose Brightcove to support their current and future online video initiatives, including their catch-up TV service, Plus7, and their breaking news services. Yahoo!7 is a joint venture between Seven Network Limited and Yahoo! Inc., which combines the online assets, television content and magazine properties of the Seven Network with the strength of Yahoo!'s global Internet platform.

Launched Brightcove Video Cloud Live, an add-on product that provides an easy-to-use dashboard for live video events and delivering multi-bitrate streams to multiple devices.

Asahi Shimbun, one of the top newspapers in Japan, adopted Video Cloud to publish video of the National High School Baseball Championship of Japan, one of that country's most popular sporting events.

Ended the quarter with 6,386 customers, which included a net increase of 16 premium customers during the quarter. New customers added during the quarter included Campbell Soup Company, IBM and All State Insurance.

Business Outlook

Based on information as of today, July 25, 2013, the Company is issuing the following financial guidance:

Third Quarter 2013: The Company expects revenue to be $26.8 million to $27.3 million, and non-GAAP loss from operations to be $900,000 to $1.2 million. Assuming approximately 28.3 million shares outstanding, Brightcove expects its net loss per basic and diluted share attributable to common stockholders to be $0.14 to $0.15, which includes estimates for stock-based compensation expense of $1.6 million, merger-related expenses of $375,000 and amortization of acquired intangible assets of $430,000. Brightcove expects its non-GAAP net loss per basic and diluted share attributable to common stockholders to be $0.05 to $0.06, which excludes the estimated expenses referenced in the previous sentence.

Full Year 2013:

The Company is raising its 2013 financial guidance for revenue and non-GAAP loss from operations. Revenue is expected to be $106.3 million to $107.5 million, and non-GAAP loss from operations is exp

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