After U.S. markets closed last Thursday afternoon, digital content delivery platform provider Limelight Networks Inc. (LLNW:NASDAQ), which helps emerging media and technology companies with online content delivery and AppOps solutions at the edge, announced unaudited financial results for its fourth quarter of 2021 ended December 31, 2021.
The firm advised that during 2021 it had successfully met several key strategic milestones. The company indicated that during Q4/21 it achieved significant sequential growth in revenue, gross margin and adjusted EBITDA.
Limelight Networks' President and CEO Bob Lyons stated, "As expected, our fourth quarter built on the momentum exhibited in the third quarter. Revenue for the fourth quarter came in at $62.9 million, up 14% quarter over quarter and year over year. Gross Margin was 35.4%, up 670 basis points quarter over quarter and Adjusted EBITDA margin was 15%, up from 11% in the third quarter of 2021."
"On an organic basis, revenue growth was 7% and we generated over $3 million in free cash flow. Layer0 contributed $3.8 million in the quarter bringing their total contribution to the year to $4.5 million, in line with guidance of $4-5 million…We have made meaningful progress in our core business with dramatic performance improvements in our network, a revitalized go-to-market strategy and new product cadence. We are changing the narrative around Limelight from a usage-based network to a high growth, higher margin edge enabled solutions company," Lyons added.
The company discussed some of the progress it has achieved recently in its operations. The firm said it is continuing to make improvements in its performance and cost structure and noted that its client sentiment metric improved double digits in H2/21 across its global top 20, adding that 18 of the top 20 Limelight customers grew revenue more than 20% for the third consecutive quarter.
Limelight also reported that its total bookings increased by 45% quarter-over-quarter in Q4/21 and that it closed over 10 contracts which will each generate revenues exceeding $100,000 annually.
The firm highlighted that in Q4/21 it launched its Layer0 by Limelight offering for web applications for the AppOps segment which it followed with GraphQL caching and serverless hosting functionality.
The company explained that "Layer0 has solved the key challenge of caching GraphQL APIs at the network edge, which is not supported by traditional web CDNs."
The company reported that during Q4/21 it posted revenue of $62.9 million, compared to $55.2 million in Q3/21 and $55.4 million in Q4/20.
The firm stated that in Q4/21 it recorded a GAAP net loss of $7.7 million, or net loss of $0.06 per basic share. The company advised that this amount represented a $2.4 million improvement over Q3/21 when it registered a net loss of $10.1 million, or a net loss of $0.08 per basic share. Limelight Networks listed that during Q4/20, it had reported a GAAP net loss of $8.3 million, or $0.07 per basic share.
The company added that adjusted EBITDA in Q4/21 rose by $3.6 million to $9.7 million, compared to $6.1 million in Q3/21 and was also significantly higher than the $3.6 million it earned in Q4/20.
The company did not provide any specific forward guidance but noted that in H2/21 it was able to change the trajectory of its business upward and expects that momentum and progress will continue in FY/22. The firm mentioned that it has expanded its sales team and new product offering and expects to enjoy solid growth in both its Content Delivery and AppOps solutions sets.
Limelight is a provider of digital media content delivery network services over the internet. The company stated that "it provides edge-enabled solutions to deliver fast, secure digital experiences on a global scale." The firm's global private network allows its customer to deliver valuable digital assets efficiently and securely. The firm's customers include large and small media and entertainment companies in the television, music, radio, news, movie, gaming, social media and other industries.
Limelight Networks has a market capitalization of around $499.1 million with approximately 133.8 million shares outstanding and a short interest of about 3.0%. LLNW shares opened slightly higher Friday at $3.78 (+$0.05, +1.34%) over Thursday's $3.73 closing price. The stock traded between $3.75 and $4.27 per share and closed for trading on Friday at $4.24 (+$0.51, +13.67%).
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