Sonic Foundry Announces Fiscal 2020 Fourth Quarter and Fiscal 2020 Financial Results – Third Consecutive Quarter of Net Income

MADISON, Wis., Dec. 22, 2020 (GLOBE NEWSWIRE) — Sonic Foundry, Inc. (OTC Pink Sheets: SOFO), the trusted leader for video creation and management solutions, as well as virtual and hybrid events, today announced consolidated financial results for its fiscal 2020 fourth quarter and fiscal year ended September 30, 2020.Fiscal 2020 Fourth Quarter HighlightsBillings of $11 million in the fourth quarter of 2020, a $1.2 million increase over the same quarter last yearTotal revenues of $10.2 million compared to $9.2 million in the fourth quarter of 2019, a 10 percent increaseGross margin was $7.3 million, or 72 percent in the fourth quarter of 2020 compared to $6.5 million, or 70 percent in the fourth quarter of 2019Net income attributable to common stockholders of $439,000, or $0.06 per share, compared to a net loss of $(179,000), or $(0.03) per share, in the fourth quarter of 2019, an improvement of $618,000Adjusted EBITDA of $1.6 million for the fourth quarter of 2020 compared to $744,000 in the same quarter last year, a 115% improvementUnearned revenue was $12.1 million as of September 30, 2020 and $11.5 million as of September 30, 2019Fiscal 2020 Year-End HighlightsBillings totaled $35.4 million in fiscal 2020 compared to $35.1 million in the prior yearRevenue remained flat year over year at $34.8 million despite impacts from COVID-19Gross margin declined slightly from 73 percent in fiscal 2019 to 72 percent in fiscal 2020Net loss attributable to common stockholders of $(179,000), or $(0.02) per share compared to a net loss of $(3.7) million, or $(0.64) per share in fiscal 2019Adjusted EBITDA was $2.4 million for the year compared to $(450,000) in the prior year. The company adjusts EBITDA for non-cash stock compensation expense and severance expenseFiscal 2020 Fourth Quarter ReviewProduct billings were $2.9 million during the fourth quarter of 2020 compared to $3.7 million in the same quarter last year. Service billings, including support, hosting, events and installs were $8 million, compared to $6.1 million in the prior year.  Notably, billings related to hosting increased 86 percent in the fourth quarter of 2020 compared to the same quarter last year.  These increases in services are indicative of the acceleration in video content creation across the globe. The company expects to recognize $4.1 million of the current unearned revenue in the first quarter of fiscal 2021. Recurring revenue of $6.8 million was 67 percent of total revenue in the fourth quarter of 2020, compared to $5.9 million, or 64 percent of total revenue, in the fourth quarter of 2019. “It has been incredibly exciting for me to join Sonic Foundry at this pivotal point in its 30-year history,” said Joe Mozden Jr., CEO, Sonic Foundry. “Every organization across the world has been impacted by COVID-19 in a profound way. We have had the sincere privilege of being positioned to help our customers navigate unchartered waters – new users like Norland College in the United Kingdom and Hamid Bin Khalifa University, part of the Qatar Foundation, and longtime clients like Florida Atlantic University and Texas A&M University. Our solutions are helping them continue, if not grow their businesses, by keeping their classes, trainings, work and events going virtually, despite distance.”  Mozden continued: “Whether it’s migrating a health organization’s in-person conference to a virtual platform to ensure they continue to exchange vital information with thousands of users, or enabling teachers to connect with their students in more thoughtful and engaging ways, we’re proud to be a lifeline to our customers in this new video-centric world.” “We are rapidly adapting our business to the trends that we are seeing, and are accelerating our investments and focus on high value-add markets which we believe will grow in a post COVID world. Increased demand for hosting, our virtual events platform and our video content management capabilities reflect significant opportunities for Sonic Foundry and are the basis for changes we are making in our business. I am extremely proud of our team for quickly pivoting to meet our customers’ needs during this difficult year. We are beginning a new journey with greater emphasis on product orientation coupled with our historical customer-centric focus. A great example of that is the innovations we are driving for in the new hybrid world for the classroom, the office, and the events industry,” he concluded.  Non-GAAP Financial Information
To supplement and enhance the reader’s understanding of our operating performance, we disclose adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (adjusted EBITDA), a non-GAAP measure of operating performance. Our adjusted EBITDA measure additionally adds back stock compensation expense as well as severance expense from the SEC definition of EBITDA. As such, our adjusted EBITDA may not be comparable to similarly titled measures reported by other companies and should not be viewed as an alternative to net income as a measurement of our operating performance. A reconciliation of net loss to adjusted EBITDA for the fourth quarter ended September 30, 2020, and 2019 are included in the release.About Sonic Foundry®, Inc.
Sonic Foundry (OTC Pink Sheets: SOFO) is the global leader for video capture, management and streaming solutions. Trusted by more than 5,200 educational institutions, corporations, health organizations and government entities in over 65 countries, its Mediasite Video Platform quickly and cost-effectively automates the capture, management, delivery and search of live and on-demand streaming videos. Learn more at www.sonicfoundry.com.© 2020 Sonic Foundry, Inc. Product and service names mentioned herein are the trademarks of Sonic Foundry, Inc. or their respective owners.Forward Looking Statements
This news release contains forward-looking statements about the products and services of Sonic Foundry within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward looking statements include statements about our products and services, our customer base, strategic investments, new partnerships, our future operating results and any statements we make about the company’s future. These types of statements address matters that are subject to many risks and uncertainties. Actual results could differ materially from the forward-looking guidance we provide. Any forward-looking statements should be considered in context of the risk factors disclosed in our periodic forms 10Q, 10K and other filings with the SEC. These filings can be accessed on-line at www.sec.gov and other websites or can be obtained from the company’s investor relations department. All of the information and disclosures we make in this news release regarding our business, including any forward-looking guidance, are as of the date given and we assume no obligation to update or change this information, regardless of subsequent events.Contact:
Nicole Wise, Director of Communications
920.226.0269
nicolew@sonicfoundry.com

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