Revenues Up 25% for 2016 announces positive financial results for Q4 and the full year 2016. The ObjectVideo price tag is revealed.

Rodney Bosch

TYSONS, Va. — (NASDAQ: ALRM) reported fourth-quarter earnings of $3 million after the market closed March 15.

On a per-share basis, the connected-home platform provider posted net income of 6 cents. Earnings, adjusted for one-time gains and costs, were 19 cents per share.

The results beat analyst expectations. The average estimate of seven analysts surveyed by Zacks Investment Research was for earnings of 13 cents per share.

The company posted revenue of $69.8 million in Q4, which also beat analyst forecasts. Five analysts surveyed by Zacks projected $64 million.

Imperial Capital upgraded’s stock to outperform from in-line and increased its one-year price target to $35 from $30 or about 11 percent above the recent share price. The rating was issued March 17.

For the year, the company reported total revenue grew to $261.1 million, up 25 percent year-over-year. Net income was $10.2 million, or 21 per share., which services approximately 5 million residential and commercial subscribers around the world, expects full-year earnings in the range of 73 cents to 75 cents per share, with revenue in the range of $322 million to $325.5 million.

During an earnings call with analysts, CFO Steve Valenzuela said fourth-quarter SaaS and license revenue grew 21 percent over the same period last year to $46.9 million. Total revenue for Q4 increased 23 percent to $69.8 million. For the year, SaaS and license revenue grew 23 percent to $173.5 million with total revenue of $261.1 million, an increase of 25 percent over 2015.

“Our SaaS and license revenue visibility remains high as evidenced by our revenue renewal rate of 94 percent in the fourth quarter of 2016. However, we did start to see some impact from AT&T 2G sunset program, which will likely continue into this year,” Valenzuela said. “Taking this into consideration, we still expect our revenue renewal rate to stay within our long-term expectation of 92 percent to 94 percent.”

Fourth-quarter hardware and other revenue was $22.9 million, an increase of 26 percent year-on-year. Valenzuela attributed the growth in part to a doubling in video camera and video doorbell sales, stating, “We were encouraged to see another solid quarter in video-related sales as these customers tend to invest and engage more with their systems.” President and CEO Steve Trundle discussed the company’s recent acquisitions during the call, including purchases of Icontrol’s Connect platform and its DIY solution, Piper. Connect powers several service provider solutions, including ADT Pulse.

Trundle said will serve as the exclusive provider of services for ADT’s professionally installed residential interactive security automation and video offerings for up to five years, subject to certain performance conditions.

ObjectVideo Price Tag Revealed

On March 14, announced it had acquired ObjectVideo, a provider of intelligent video software, including its products, technology portfolio and personnel. That deal was consummated in January for a previously undisclosed price tag of $6 million.

Trundle said video is a strategic area of growth in both the residential and commercial sectors, adding the ObjectVideo acquisition particularly excites him in terms of what it does for the company’s platform and the types of applications it opens up in the future.

“This is a team that does have the ability to track objects to make determinations about license plates, to make determinations about flow of either people or vehicles through a given location,” he said. “So fortunately, with our service provider footprint, quite a few of them are already selling in to the commercial and sometimes what is called the integrators space already and we see an opportunity to significantly upgrade our platform to make it suitable for a wider range of applications through time like that.”

About the Author

Rodney Bosch:

Although Bosch’s name is quite familiar to those in the security industry, his previous experience has been in daily newspaper journalism. Rodney Bosch is an editor for CE Pro sister publication Security Sales & Integration. Bosch is a graduate of California State University, Fresno with a degree in Mass Communication & Journalism. In 2007, he successfully completed the National Burglar and Fire Alarm Association’s National Training School coursework to become a Certified Level I Alarm Technician.