But those numbers will turn around when more users adopt smart TV and Internet protocol TV solutions in the near future, Espial president and CEO Jaison Dolvane predicted in a conference call Thursday.
Revenues of $2.7 million this quarter were down 33 per cent year-over-year, from $4.1 million in the final quarter of fiscal 2011.
The year-end tally of $13.3 million in revenue was a 9.5 per cent decline from fiscal 2011.
The local digital TV and IPTV software and solutions supplier reported a net loss of $1.3 million during the quarter, compared to a net loss of $566,689 during the same period the previous year.
Overall in fiscal 2012, the company incurred a net loss of $2.7 million, slightly greater than its net loss of $2.5 million in 2011.
At the end of 2012, the company had cash and cash equivalents of $11.2 million.
The company experienced a slower pace of roll-outs from its existing pay-TV customers, especially in Europe. That slowdown will likely continue throughout the next two to three quarters, Mr. Dolvane said.
“While our current customers are committed, there seems to be some cautiousness in their (spending),” he said, adding that he expects those customers to become more aggressive with their investments later this fiscal year and early next.
Despite the negative numbers, Mr. Dolvane said Espial sees opportunities ahead in the smart TV market – clearly evidenced by this year’s Consumer Electronics Show in Las Vegas where many companies showed off their high-tech TVs.
Mr. Dolvane said that although smart TV features are currently in high-end TVs only, he anticipates they will become a core element of mass market flat screen TVs over the next 12 to 18 months.
He added that it is still early days for the industry, but that within the next few years about one billion TVs will be shipped each year – and most of them will be smart TVs.
Additionally, he said there are 600 million paying subscribers for TV globally, and that virtually all of their providers are planning to launch IPTV services in the future, to adapt to customers who want “video and web when and where they want,” Mr. Dolvane said.
“We’re quite early in this market … but we expect (uptake) to increase significantly in the coming years,” he said.
In a report published Thursday, American analytics firm Multimedia Research Group forecast that global IPTV subscriber growth will nearly double between 2012 to 2016, growing from US$29.1 billion last year to US$56.8 billion in 2016.
The report showed strong growth in the IPTV industry in 2012, particularly in Asia as a result of maturing markets such as China and South Korea. Currently, China has the most IPTV subscribers worldwide and that trend will likely continue, according to the report.
Espial’s fourth quarter results come after a weak third quarter, with falling revenues hurting the company’s bottom line as customers slowed their purchases.
In February, Espial finalized its acquisition of an embedded software company in the United Kingdom called ANT plc. That transaction will increase the company’s revenues, scale, intellectual property depth and customer footprint worldwide, Mr. Dolvane said during the conference call.
Also last month, local intellectual property firm Wi-LAN Inc. announced it would assist Espial license some of its patents related to video-over-IP technology. Espial will share with WiLAN net revenues generated from the patents.