Synchronoss Technologies(SNCR)2024-11-12 21:34Revenue Performance - Net revenues increased by $3.2 million to $43.0 million for the three months ended September 30, 2024, compared to the same period in 2023, primarily due to continued cloud subscriber growth [166]. - Net revenues increased by $6.6 million to $129.4 million for the nine months ended September 30, 2024, compared to the same period in 2023, driven by continued cloud subscriber growth [177]. Cost Management - Cost of revenues decreased by $0.5 million to $9.0 million for the three months ended September 30, 2024, attributed to reduced baseline employee costs from restructuring measures [167]. - Cost of revenues decreased by $2.3 million to $29.6 million for the nine months ended September 30, 2024, primarily due to reduced employee costs from restructuring measures [178]. - Selling, general and administrative expenses decreased by $6.5 million to $13.8 million for the three months ended September 30, 2024, primarily due to reduced employee costs from restructuring [169]. - Selling, general and administrative expenses decreased by $13.7 million to $39.8 million for the nine months ended September 30, 2024, compared to the same period in 2023 [180]. - Research and development expenses increased by $1.0 million to $10.3 million for the three months ended September 30, 2024, mainly due to higher performance-based compensation expenses [168]. - Research and development expenses decreased by $2.8 million to $32.6 million for the nine months ended September 30, 2024, attributed to reduced baseline employee costs from restructuring [179]. - Restructuring charges were $0.3 million for the nine months ended September 30, 2024, down from $0.4 million in the same period in 2023 [181]. Interest and Tax Expenses - Interest expense increased by $2.0 million for the three months ended September 30, 2024, mainly due to interest related to a new Term Loan obtained [172]. - Interest expense increased by $2.1 million for the nine months ended September 30, 2024, primarily due to $2.2 million related to a new Term Loan [183]. - The effective tax rate was approximately (12.3)% for the three months ended September 30, 2024, lower than the U.S. federal statutory rate due to permanent adjustments [174]. - Income tax expense was approximately $3.9 million for the nine months ended September 30, 2024, with an effective tax rate of approximately 178.6% [185]. - Unrecognized tax benefits associated with uncertain tax positions were $4.4 million at September 30, 2024 [200]. Cash Flow and Financial Position - Cash provided by operating activities was $15.2 million for the nine months ended September 30, 2024, down from $19.2 million in the same period in 2023 [193]. - Cash used in investing activities was $9.1 million for the nine months ended September 30, 2024, compared to $15.9 million in the same period in 2023 [194]. - Cash used in financing activities was $5.4 million for the nine months ended September 30, 2024, down from $7.5 million in the same period in 2023 [196]. - As of September 30, 2024, the cash and cash equivalents balance was $25.2 million, with non-U.S. subsidiaries holding approximately $13.9 million [188]. - As of September 30, 2024, a hypothetical 100 basis point movement in interest rates would have affected interest expense on the debt by $0.8 million annually [213]. Customer Concentration - The Company's top five customers accounted for 97.9% of net revenues for the nine months ended September 30, 2024, indicating a high customer concentration risk [162]. Depreciation and Amortization - Depreciation and amortization expense increased by $0.3 million to $12.8 million for the nine months ended September 30, 2024, compared to the same period in 2023 [182].