Avid Technology (AVID) swung to a net profit for the quarter ended Dec. 31, 2016. The company has made a net profit of $5.22 million, or $ 0.13 a share in the quarter, against a net loss of $4.38 million, or $0.11 a share in the last year period.     

Revenue during the quarter dropped 16.94 percent to $115.30 million from $138.81 million in the previous year period. Gross margin for the quarter expanded 122 basis points over the previous year period to 60.25 percent. Operating margin for the quarter period stood at positive 9.50 percent as compared to a negative 0.25 percent for the previous year period.

Operating income for the quarter was $10.95 million, compared with an operating loss of $0.35 million in the previous year period.

However, the adjusted operating income for the quarter stood at $21.23 million compared to $13.58 million in the prior year period. At the same time, adjusted operating margin improved 863 basis points in the quarter to 18.41 percent from 9.78 percent in the last year period.

"Thanks to strong execution in key focus areas we met or exceeded quarterly guidance for all of our metrics and delivered positive Adjusted Free Cash Flow," said Louis Hernandez, Jr, chairman and chief executive officer of Avid. "We saw sequential bookings growth across all customer tiers and geographies. This performance included a rebound in storage, an improvement in Orad applications, continued growth of cloud-enabled subscribers and digital sales, and traction on enterprise deals such as the global enterprise and cloud agreement with Al Jazeera. Execution on our efficiency program drove a 29% year-over-year reduction in operating expenses. We are confident that we can complete the remaining efficiency program in 2017, which includes more than $30 million of additional annual savings.

For the first-quarter, Avid Technology projects revenue to be in the range of $100 million to $110 million.

For financial year 2017, Avid Technology projects revenue to be in the range of $405 million to $435 million.

The company has spent $15.58 million cash to meet investing activities during the year as against cash outgo of $81.80 million in the last year.

Cash flow from financing activities was $91.45 million for the year, down 16.53 percent or $18.11 million, when compared with the last year.

Cash and cash equivalents stood at $44.95 million as on Dec. 31, 2016, up 151.08 percent or $27.05 million from $17.90 million on Dec. 31, 2015.

Working capital remains negative
Working capital of Avid Technology was negative $86.93 million on Dec. 31, 2016 compared with negative $167.45 million on Dec. 31, 2015. Current ratio was at 0.63 as on Dec. 31, 2016, up from 0.45 on Dec. 31, 2015.

Cash conversion cycle (CCC) has increased to 42 days for the quarter from 22 days for the last year period. Days sales outstanding went down to 17 days for the quarter compared with 19 days for the same period last year.

Days inventory outstanding has increased to 51 days for the quarter compared with 39 days for the previous year period. At the same time, days payable outstanding went down to 27 days for the quarter from 37 for the same period last year.