Release Date: February 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide some parameters around the timing and milestones for the Disney litigation and your engagement with other video streaming vendors? A: We have engaged Disney for over 2.5 years in bilateral negotiations and concluded that enforcement is needed. The timing of the lawsuit's resolution is uncertain, as it can vary from being resolved quickly to taking multiple years. We are also engaging with other major streaming service providers and hope to make progress through bilateral negotiations. - Liren Chen, President, CEO
Q: Could you provide some color on the annual guidance, particularly regarding catch-up sales versus recurring revenue? A: We ended 2024 with $468 million of annualized recurring revenue (ARR) and aim for double-digit growth in ARR by the end of 2025. The $91 million of expirations in 2025 are typically at the end of the year, so they don't impact Q1 significantly. The step down from Q4 to Q1 is mainly due to 2024 expirations. - Richard Brezski, CFO
Q: How do you plan to monetize the streaming opportunity, and what metrics will you use for royalty rates? A: We are flexible in negotiating with customers based on the right metrics, which could be subscription-based or a percentage of overall revenue. The streaming industry is projected to be the same size as the smartphone industry by 2027, and we aim for $300 million in recurring revenue from streaming by 2030. - Liren Chen, President, CEO
Q: What is the impact of geopolitical tensions between China and the US on your contracts? A: Our technology is global and built on open standards, not subject to export controls. Most of our large customers have international business, which is a healthy dynamic for us. We engage with policymakers to explain why our business model is beneficial, and we have strong support across different countries. - Liren Chen, President, CEO
Q: How do you handle contract expirations, and are they renewed before or after expiration? A: It's normal to have some contracts expire each year. We aim to renew them before expiration, but some may carry over due to timing. We start negotiations six months to a year ahead, demonstrating the value of our technology and aiming for higher valuations if customers have benefited more. - Liren Chen, President, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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