Hosted Contact Center Featured Article

inContact Reports Growth in Fourth Quarter

Cloud-based contact center software developer inContact announced that it saw software and telecom revenue growth in the fourth quarter of 2011. The company also announced results for the full year.

Consolidated revenue for the final quarter of 2011 increased more than 17 percent to $23.8 million compared to $20.3 million for the same period in 2010. The company noted that this marked the highest quarterly consolidated revenues yet achieved.  The results were boosted by a $2.3 million rise in software revenue and a $1.2 million jump in quarterly telecom revenue over fourth quarter 2010. Software revenue increased by 26 percent over 2010, rising to $11.0 million for the quarter, a record sequential quarterly increase for the company. Telecom revenue hit $12.7 million during the fourth quarter, the third consecutive quarter that Telecom segment revenue has increased year-over-year. The company attributed telcom growth to rising software-related telecom revenue, which has grown to 64 percent of total telecom revenue.

The company noted a fourth quarter accounting change, altering the period over which it “recognizes certain software professional services fees.” Without the change in fee recognition period, software segment revenue would have increased by 28 percent over fourth quarter 2010, rising to $11.2.

"I'm pleased to report that in the fourth quarter, we achieved record software segment revenue, as well as a 40 percent increase in bookings over the fourth quarter of last year, representing the strongest software bookings in the Company's history,” said Paul Jarman, inContact CEO, in a company statement. “We are seeing a marked shift in the size, type and number of contact centers that are choosing inContact to power their business and, during the quarter, we closed 44 new customers and 20 expansions for a total of 64 new contracts."

The company noted that annual 2011 results saw software segment revenue increase 18 percent over 2010, rising to $39.9 million. Additionally, Telcom revenue rose one percent over 2010 results to $49.1 million for the year, the first time telcom revenue had seen an annual increase since 2005.

"This is a true inflection point for inContact. As one of the pioneers of cloud contact center solutions, we established inContact as an early market leader, and are seeing strong results from our investments in innovation, the platform and sales and marketing. These investments will enable us to extend our lead and increase our share in the rapidly growing cloud-based contact center market,” Jarman added in the statement.

Though revenues for the software segment increased in the fourth quarter, the company noted that gross margin for the segment fell to 56 percent compared to 62 percent in the same period in 2010. If non-cash charges were included, then non-GAAP Software segment gross margin came in at 68 percent for the quarter, compared to 74 percent in 2010. inContact attributed the decline in gross margin to investments “we anticipated making in our strategic international facilities and reseller programs, as well as higher non-cash depreciation and amortization.”These investments included establishment the European cloud network, back office and infrastructure investment to support Siemens Enterprise Communications, Verizon (News - Alert) Business and other new partners.

• Five9 and Birst Team to Provide Business Analytics to Contact Centers
• Dispelling the Myths about Hosted Contact Centers
• Deploy a Hosted Contact Center in No Time
• Cloud-based Contact Center Company Five9 Completes Funding Round