Synchronoss Technologies Inc (NASDAQ:SNCR) delivered a solid first quarter, driven by cloud subscriber growth, high recurring revenue, improved margins, and strong operational execution.
The personal cloud software provider reported first-quarter results in line with its expectations on Tuesday and said it had completed a $200 million refinancing that strengthens its balance sheet.
During the quarter ended March 31, Synchronoss posted revenue of $42.2 million, slightly down from $43 million a year earlier, as the expiration of a customer contract offset a 3.3% increase in cloud subscribers.
Recurring revenue made up 93.1% of the total, up from 91.1% a year ago.
Income from operations more than doubled to $8.2 million from $4.6 million a year earlier. Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) rose 17% to $12.7 million, representing a margin of 30.2%.
The new four-year loan from TP Birch Grove allowed Synchronoss to retire $73.6 million of existing debt and is expected to fund the redemption of the remaining $121.4 million in senior notes.
“We believe that this enhancement to our capital structure, combined with our 93.1% quarterly recurring revenue and improved adjusted EBITDA and gross margins, provides the company with increased confidence in attaining our results for the year during a volatile time in the global economy,” CEO Jeff Miller said in a statement accompanying the results.
Synchronoss reaffirmed its full-year 2025 guidance, including revenue of $170 million to $180 million, adjusted EBITDA of $52 million to $56 million, and free cash flow of $11 million to $16 million, excluding the impact of a pending $28 million US federal tax refund the company expects to receive this year.
“Our team’s relentless focus on empowering our blue chip, global carrier partners with cutting-edge personal cloud solutions continues to drive meaningful results for our partners and Synchronoss,” Miller added.
Net loss for the quarter was $3.8 million, or $0.37 per share. The company attributed the swing primarily to $5.6 million in non-cash foreign exchange losses tied to revaluations of intercompany balances.
Synchronoss said it continues to receive indications from the IRS that support a high level of confidence in receiving the full refund plus applicable interest.