Record revenues during the fourth quarter helped Synacor Inc. nearly break even, even though the Buffalo internet content provider now says sales from its much-anticipated contract with AT&T will be far less than originally anticipated.
Synacor said it lost $106,000, or less than a penny per share, compared with a loss of $3.1 million, or 10 cents per share, a year ago. Sales rose 32 percent to $46 million from $34.9 million.
Himesh Bhise, Synacor's CEO, said sales grew solidly at its publisher advertising and software businesses. Its contract to provide portal services to AT&T, which had been expected to generate $100 million a year in revenue at its peak in 2019, produced $25 million in sales through the final three quarters of last year, and Bhise said he expect revenues from the AT&T deal to run at about the same rate this year.
The revenue forecast from the contract has been more than cut in half because AT&T is focusing on bringing traffic through the portal, rather than generating revenue from it. Synacor shares fell by 15 percent, or 30 cents, to a more than two-year low of $1.75 in mid-day trading on Friday.
Synacor said it expects to lose between $4.4 million and $8.6 million this year, down from a loss of $9.8 million in 2017. The company predicted that revenue would rise by between 7 percent and 11 percent to $150 million to $155 million, up from $140 million in 2017.