NEW YORK - Kaltura, Inc. (NASDAQ:KLTR), known for its Video Experience Cloud services, announced today a stock repurchase program that permits the company to buy back up to $5 million of its common stock.
This move is a strategic decision by the company's Board of Directors, reflecting their belief that the current share price does not accurately represent Kaltura's long-term value proposition.
The repurchase program allows Kaltura to acquire shares through various methods, including open market purchases and privately negotiated transactions, adhering to federal securities laws and the Securities Exchange Act of 1934's Rule 10b-18. The company may also engage in Rule 10b5-1 plans to manage the timing of these purchases.
While the program does not require Kaltura to buy any specific number of shares and can be altered or halted at the Board's discretion, the company intends to fund the repurchases from its existing cash, cash equivalents, short-term investments, and future cash flows.
In conjunction with this announcement, Kaltura has reaffirmed its financial outlook for the second quarter and the full year of 2024, maintaining its previously stated guidance for Subscription Revenue, Total Revenue, and Adjusted EBITDA. For the second quarter, they expect Subscription Revenue to be between $39.6 million and $40.3 million, Total Revenue between $42.7 million and $43.5 million, and Adjusted EBITDA ranging from a loss of $0.6 million to a gain of $0.4 million. The full-year projections anticipate Subscription Revenue of $161.2 million to $164.2 million, Total Revenue of $173.7 million to $176.7 million, and Adjusted EBITDA between $0 million to $1 million.
Kaltura's core business provides live, real-time, and on-demand video products for various industries, including educational institutions and media and telecom companies. Their Video Experience Cloud is designed to support a range of video experiences and workflows, serving an array of clients worldwide.
This information is based on a press release statement from Kaltura, Inc.
In other recent news, Kaltura, Inc. has reported its Q1 2024 financial results, showcasing a 3% increase in total revenue to $44.8 million and a 2% rise in subscription revenue to $41.2 million. The video cloud platform also recorded a positive adjusted EBITDA of $0.6 million, marking its third consecutive quarter of profitability. Additionally, Kaltura's GAAP gross profit reached $28.6 million, displaying a year-over-year increase.
The company has closed several large deals primarily through upselling to existing customers and reported improved gross retention rates. Despite anticipating a modest revenue decline in Q2, Kaltura expects to return to growth in the latter half of the year, maintaining its full-year guidance for total revenue and positive adjusted EBITDA.
In other developments, Kaltura has partnered with big brands like Salesforce (NYSE:CRM) and Adobe (NASDAQ:ADBE) to support AI initiatives. The company also plans to reduce costs with the development of an in-house transcription engine and is monitoring industry consolidation opportunities and regional growth trends.
InvestingPro Insights
In light of Kaltura, Inc.'s (NASDAQ:KLTR) announcement regarding its stock repurchase program, several key metrics and insights from InvestingPro are noteworthy. Kaltura's market capitalization stands at $145.3 million, which, considering the repurchase program, indicates a proactive approach to managing its market value. The company's Price to Book ratio for the last twelve months as of Q1 2024 is 5.78, which may suggest a premium compared to its tangible assets, a factor for investors to consider when evaluating the buyback's impact on shareholder value.
From a profitability standpoint, Kaltura has not been profitable over the last twelve months, with an adjusted P/E ratio of -3.25. This aligns with the insights from InvestingPro Tips, which indicate that analysts do not expect the company to be profitable this year, and two analysts have revised their earnings estimates downwards for the upcoming period. These factors could be contributing to the company's decision to repurchase shares, potentially signaling management's confidence in future profitability and an effort to stabilize stock prices.
Despite the challenges, Kaltura's gross profit margin remains strong at 64.27%, reflecting its ability to maintain a high level of operational efficiency in generating revenue from its Video Experience Cloud services. However, the stock has experienced a significant decline over the last three months, with a 26.19% drop in price total return, which may have prompted the buyback initiative.
Investors interested in a deeper analysis can find additional InvestingPro Tips for Kaltura at https://www.investing.com/pro/KLTR, including insights on cash holdings, dividend policies, and stock performance trends. To enhance their investment strategy, readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which includes access to a wealth of financial data and expert analysis. There are 7 additional InvestingPro Tips available for Kaltura, offering a comprehensive overview of the company's financial health and market position.
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