SEAC stock has been flailing in the deep seas. Shares of SeaChange International (SEAC) dropped a significant 12.21% yesterday, December 14, after the company released its financial and operational results for the fiscal third quarter ended October 31.
SeaChange is a leading developer of platforms that help television operators and telecommunications companies to manage, store and distribute digital video. Its Q3 print looks solid on the outside, with a debt-free balance sheet and year-over-year revenue growth.
However, its persistent negative cash flow (also called cash burn) was what concerned investors. Non-GAAP loss of operations of $1.4 million, which translated to a loss of 3 cents per share, did not sit well with investors. If we look at the company’s financials since 2019, we see that SeaChange has been running at a loss since around the first quarter of fiscal 2020. Overall, SEAC stock earnings have been disappointing.
Optimistic Change
Digging deeper, the company has burned $8.3 million cash in the last twelve months, which is about 11.2% of its market cap of $74.05 million. This is a little worrying.
However, luckily, the shares are up around 16.6% in the pre-market trading hours, probably buoyed by the efforts taken by the company to reduce its operating expenses, remain debt-free, and manage to shrink its cash burn in the past year.
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