Avid Reports 3Q Revenue Up 1.3%

The company said the “recurring components of the company’s revenue remained strong during the third quarter, with subscription revenue increasing 49.2% year-over-year in the third quarter to $41.8 million and subscription & maintenance revenue growing 17.6% year-over-year to $69.1 million.

Total revenue increased 1.3% year-over-year to $103 million in the third quarter, led by the strong subscription growth but offset by continuing supply chain challenges that have impacted the company’s ability to ship a significant amount of the orders received for integrated solutions during the first nine months of 2022. At constant currency, total revenue increased 6% year-over-year and subscription & maintenance revenue increased 22.3% year-over-year in the third quarter.

The revenue growth, combined with improved gross margin, resulted in Adjusted EBITDA of $21.0 million, representing 20.4% of revenue, and non-GAAP earnings per share of $0.38, an increase of 40.7% year-over-year.

Jeff Rosica, Avid’s chief executive officer and president, said: “We are pleased by the strong growth from our subscription software business, particularly enterprise subscription and reacceleration of our creative tools, most notably Pro Tools. Demand for our integrated solutions products remains strong, and while we continue to see some lingering constraints in the supply chain, we were able to resume production of certain audio hardware products late in the third quarter and we believe the remaining constraints are temporary. For the fourth quarter and full year, we believe we are well positioned to deliver earnings growth despite revenue headwinds from the impacts of foreign exchange and slower-than expected recovery from the current global supply chain situation.”

Ken Gayron, Avid chief financial officer and executive vice president, added: “We are pleased with our strong non-GAAP earnings per share growth of over 40% that was driven by an acceleration of our subscription business including an all-time record in paid subscription net adds during the quarter. However, due to foreign exchange headwinds and the continuing challenges with the supply chain for integrated solutions, we are modifying our 2022 guidance for revenue and free cash flow but maintaining and tightening our 2022 guidance for Non-GAAP earnings per share and adjusted EBITDA due to prudent management of the business. Solely as a result of the foreign exchange headwinds, we are modifying our 2022 guidance for subscription & maintenance revenue.”