It is very rare for us to ‘get one up’ on George O’Connor of Panmure Gordon – an analyst for whom we have great respect. But, as readers will know, we have been a backer of blinkx – the video search Mike Lynch/Autonomy spin out – from the start. I admitted to buying Blinkx at their May 07 IPO at 45p and of Keeping faith with blinkx ever since. I’ve been well rewarded as the share price is now 89p. Even better if you look at calendar 2010 alone with a stonking 440% rise!
As George said in his morning note today “We acknowledge that we missed the blinkx rally as we tried to backcast the operational assumptions, better understand the competitive usp and bellyached about transaction hijacking product Cheep – we should have just adopted a more ‘go for it’ approach – we are the poorer for it.”
George goes on to describe this morning’s results as ‘superb’. Difficult to argue with positive cash flow of $1.8m, revenues doubled to $27.4m and a swing from a $7.4m loss to a $2.0m operating profit. Founder and CEO Suranga Chandratillake:said “With video advertising forecast to increase almost 500% over the next four years, per IDC, reaching US$11.3bn by 2014, blinkx is perfectly positioned to profit from the increasing dominance of online media and the continued momentum towards ROI-driven advertising. Given this strong industry backdrop and our market position, we remain confident of the outlook.”
George concluded his note “I have made the point many times that while we currently engage information from a text-structured-data standpoint this is changing and in this transition Blinkx has a very neat offer. The distribution model is strong, a new partnership with Amino (set top boxes) today brings the channel ecosystem to 720 partners. Also blinkx has indexed over 35m hours of video and audio content to date.”