Shares of Avid Technology (AVID) declined on Friday after the company reported quarterly results, reiterated its full-year guidance, and instituted a new cost savings initiative.

WHAT’S NEW: After the close last night, Avid Technology reported a second-quarter loss per share of (20c) on revenue of $98.6M, compared to last year’s Q2 results of (26c) and $102.37M, respectively. Bookings for the quarter were $110.3M, an increase of 12% year-over-year and 9% sequentially. The company noted that it saw continued strong software revenue growth from subscription and e-commerce sales in the quarter. Looking ahead, Avid reaffirmed and narrowed its FY18 revenue view to $410M-$420M from $404M-$434M. Analysts expect Avid to report FY18 revenue of $409.9M. The company noted that the guidance reflects the adoption of the new revenue recognition standard ASC 606 as of January 1, 2018. With the reaffirmation of its annual guidance, the company said it will not be issuing quarterly guidance for the balance of the year.

SAVINGS PLAN: Additionally, Avid CFO Ken Gayron said that the company’s leadership team is executing on a new $20M non-personnel-related savings plan that he expects will “directly improve” the company’s EBITDA and free cash flow.

STREET RESEARCH: After the report, BWS Financial analyst Hamed Khorsand maintained a Hold rating and $5 price target on the stock, saying that the quarter marked the second straight quarter where Avid experienced an issue in the business for “not fully achieving their goals in the quarter.” The analyst noted that the stock could end up trading near the $5 level for another three months until the firm reports Q3 results. Investors would be “well served” to watch from the sideline until there is some “tangible” improvement in revenue and free cash flow, Khorsand contends in the note.

PRICE ACTION: In afternoon trading, shares of Avid Technology are off earlier lows, but are still down 3.2% to $5.40.

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