Avistar (News - Alert) Communications Corporation, a video collaboration platform provider, has announced its financial results for the three and nine month periods that ended September 30, 2008.

Financial highlights for the third quarter include total revenue of $2.7 million, a 51 percent increased over the previous quarter. The second quarter of 2008 had returned a 56 percent improvement compared to the first quarter of the year.

Operating expense for the company was $3.1 million for the third quarter, compared to $3.2 million for the second quarter, representing four straight quarters of improvement in this area.

Income from settlement and licensing activity was $1.1 million in both the third and second quarters of 2008. Net income represented a loss of $744,000 per basic and diluted share, as compared to a loss of $1.6 million recorded in the second quarter 2008.

The cash and cash equivalent balance on September 30, 2008 was $4.4 million, representing cash used in operations during the third quarter, 2008 of $1.3 million.  The comparable cash used in operations during the second quarter of 2008 was $3.2 million.

 

“As anticipated from our last earnings conference call, results of the third quarter of 2008 demonstrate our continued ability to build revenue momentum off of a more efficient cost structure,” said Simon Moss, Avistar’s CEO, in a Tuesday statement.

“The intended objective was accomplished, and the third quarter posted an adjusted EBITDA result (a key metric being used by the management team as a measurement of our turnaround progress – see below) of a $53,000 profit, a dramatic improvement over the second quarter 2008 adjusted EBITDA loss of $1.2 million.”

 

“After establishing a significantly reduced cost structure during the prior quarters of 2008 -- accomplished as part of our turnaround strategy, our focus shifted to the top line and revenue momentum in the third quarter,” Moss continued.

Moss highlighted that this sequencing was designed to translate company cost savings into direct bottom-line improvements as revenues continued to expand. He is pleased to report that both goals were accomplished during the third quarter of this year.

According to Moss, the third quarter is the most significant in the company’s history from the vantage point of building for the future. In August, Avistar announced a technology agreement with LifeSize (News - Alert) Communications Corporation in which Avistar will integrate its technology with LifeSize’s HD conferencing room systems.

Avistar also signed a product and technology licensing agreement with IBM Corporation in September to provide bandwidth management for IBM’s unified communications and collaboration solutions. Avistar’s C3’s (News - Alert) dynamic bandwidth technology will be licensed by IBM.

 

“We expect these arrangements to provide improved revenue visibility and momentum over the next several years,” added Moss. “As part of the LifeSize and IBM (News - Alert) agreements, both corporations are now licensees of our extensive patent portfolio as well.

 

Also during the third quarter, the U.S. Patent & Trademark Office announced that it has scheduled the issuance of an additional four patents to Avistar during the month of October. These patents cover the areas of instant messaging and VoIP.

This expanding portfolio underscores the value being placed on Avistar’s product and technology offerings, helping to growth the brand and expand the company’s reputation.  

Such positioning is important in the industry as competition is intense and only those that can produce strong and growing performance will be able to sustain through a slower economy.

These latest announcements as to the company’s progress with larger partners will help to strengthen its presence in the market and help to create better positioning in competitive situations. Continued recognition by third parties for product and technology performance will also help in building Avistar’s value in the market.

 

TMC (News - Alert) named Avistar’s C3 Desktop Videoconferencing and Collaboration solution as a recipient of a 2008 INTERNET TELEPHONY Excellence Award, in recognition of its deployment at California State University’s Lyles Center for Innovation and Entrepreneurship.