Avaya Financial Performance

Main article: Avaya

• Avaya Russia and CIS

2021: Revenue - $2.97 billion, loss - $13 million

At the end of 2021, Avaya earned $2.97 billion in revenue against $2.87 billion a year earlier. Sales of the company's software and equipment during this time decreased from $1.07 billion to $992 million, and revenues from services, on the contrary, increased from $1.8 billion to $1.98 billion.

Avaya's main earnings continue to fall on the American market. The company's revenue in the United States in fiscal 2021 reached $1.7 billion against $1.64 billion a year earlier. In EMEA countries (Europe, Middle East, Africa), sales increased from $714 million to $732 million. In the Asia-Pacific region, the turnover of the producer of corporate communications increased from $296 million to $297 million. Outside the United States, Avaya's total earnings reached $1.27 billion, up from a year ago of $1.23 billion.

Avaya remains a loss-making company

Sales of technologies for unified communications and collaboration in 2021 turned out to be $683 million, which is slightly less than the previous year ($710 million). In the segment of solutions for contact centers, revenue also decreased - from $363 million to $309 million.

Avaya's main income is related to the provision of support services: the corresponding business in 2021 showed an increase to $1.4 billion from $1.24 billion in 2020. In the category of corporate-level cloud services and management services, a slight decrease in turnover was registered - from $282 million in 2020 to $281 million a year later.

Despite growing sales, Avaya remains a unprofitable company: in 2021, its net losses amounted to $13 million, although in 2020 they were higher and measured at 680 million.

The share of recurring revenue contracts in total sales for the 12-month reporting period closed on September 30, 2021, amounted to 66% compared to 63% a year earlier.^[1]

2019: Revenue growth by 28% to $2.89 billion

Avaya's revenue in fiscal 2019 reached $2.89 billion against $2.25 billion a year earlier. At the same time, the company became unprofitable, recording an annual net loss of $671 million. In 2018, the net profit of the producer of funds for corporate communications was measured at $287 million.

At the sale of products in 2019, Avaya earned $1.22 billion, which significantly exceeds the figure of a year ago of $989 million. The service business also grew from $1.26 billion to $1.67 billion.

Avaya Financial Performance

At the end of 2019, Avaya earned about $1.55 billion in the United States against $1.51 billion a year earlier. Revenues in EMEA countries (Europe, Middle East, Africa) during this time decreased from $769 million to $753 million. In the Asia-Pacific region, turnover tripled to $327 million. The total revenue of the company outside the US market turned out to be $1.33 billion, almost unchanged from the value of a year ago.

In 2019, Avaya wrote off $657 million due to impairment in the Products & Solutions division of goodwill, an asset that characterizes the company's intangible advantages over its competitors in the market. This includes business reputation, customer base, staff qualification, brand, etc.

It follows from the annual reports that about 83% of Avaya's revenue came from the sale of software and services. Moreover, this indicator continues to grow from year to year. Approximately 58% were repetitive, and 60% of revenue was occupied by high-margin software products. The share of cloud services in the total sales of the company amounted to 11%, the number of cloud customers for the year increased by 160%. Avaya also announced the conclusion of contracts for the year totaling $2.4 billion.

Revenue from sales of unified communications solutions in 2019 amounted to $863 million, in the segment of technologies for contact centers - $359 million.^[2]

2018: Revenue drop by 13% to $2.9 billion

In fiscal year 2018, the end of which fell on September 30, 2018, Avaya's revenue amounted to $2.9 billion, a decrease of 13% compared to the previous year. Excluding currency fluctuations, sales decreased by 14%. The company's revenue has been falling for several years in a row.

About 82.2% of the company's annual turnover came from software and services sales, and recurring revenues took 57.4% - both figures were a record for the manufacturer of solutions for corporate communications.

Avaya Financial Performance

In fiscal year 2018, Avaya entered into 15 contracts worth $10 million, 55 transactions worth $5 million and higher, as well as 440 contracts in which customers pledged to pay more than $1 million. The total value of the contracts concluded exceeded $2.4 billion excluding the network business sold to Extreme Networks.

The number of jobs where UCaaS/CCaaS solutions are deployed has increased by 312%. Avaya's cloud revenue increased by 11%, which is higher than the growth rate of 2017 (9%).

In 2018, the company released 117 new products and earned a total of $1.2 billion on products against $1.4 billion a year earlier. Service revenue fell from $1.8 billion to $1.6 billion.

At the end of fiscal 2018, Avaya received a net profit of almost $3.3 billion, while in 2017 the company had losses measured at $182 million.

By the end of September 2018, Avaya had $700 million in cash and cash equivalents compared to $876 million compared to the same period of the previous year. This decline is due to the return of debts, as well as the purchase of Spoken.

Fiscal year 2018 will be remembered by Avaya for returning to the exchange after 10 years of leaving it. Prior to this, the company filed for bankruptcy, but was able to withdraw from it, launching a financial restructuring involving creditors.^[3]

2017: Loss of $182 million and reduction in equipment sales

In fiscal year 2017, Avaya's net loss decreased by more than four times to $182 million. Revenue decreased from $3.7 billion to $3.3 billion. The equipment brings the company less and less money.

Most of the revenues are still formed by the service business, the volume of which for the year exceeded $1.8 billion. The shares of cloud services, management services and professional services exceeded 8% in the case of each category.

Avaya Results: Hardware Losses and Declines

The manufacturer of solutions for corporate communications earned more than $1.4 billion on the sale of products. Software and services occupied 78% of Avaya's revenue for fiscal year 2017, which is 3 percentage points more than a year earlier.

Approximately 56% of the vendor's annual revenue is recurring, while in 2016 this figure was measured at 51%.

About 55% of Avaya's turnover at the end of 2017 fell on the American market. The second largest market for the company remains EMEA (Europe, Middle East, Africa), which brought 26% of revenue during the reporting period. The share of the Asia-Pacific region was 10%.

2017 was a landmark year for Avaya. The company completed a financial restructuring that allowed it to emerge from bankruptcy and return to the exchange. From the moment the bankruptcy proceedings began in accordance with Chapter 11 of the  US Bankruptcy Code before withdrawing from it, the company managed to conclude more than 3,600 contracts with customers, according to the financial statements.

By the end of fiscal 2017, Avaya's workforce had dropped to  8,700 from 10,100  employees a year earlier. As a result, annual revenue per employee increased from 366 to 376 thousand dollars.

The President and CEO of Avaya called the financial results "outstanding" in the face of the threat of bankruptcy and noted that these results demonstrate the sustainability of the company's business model, as well as the loyalty of customers and partners.^[4]

2016: 5-fold increase in losses

In fiscal 2016, Avaya's revenue decreased by 9%, and losses increased by more than five times. The company continues to be in financial decline, due to which bankruptcy proceedings were launched.

At the end of the reporting year, Avaya's sales amounted to $3.7 billion against $4 billion a year earlier. Net loss rose from $144 million to $750 million.

Avaya Stadium

Most (75%) of Avaya's turnover was occupied by software and services, compared to 71.3% in fiscal year 2015. Revenue from sales of products for call centers increased by 6%, and in the segment of cloud services and management services, revenues increased by 5%.

The share of recurring sources of income accounted for 52.1% of revenue for FY2016, while a year earlier the figure was measured at 48.9%.

The largest market for Avaya products and services remains the United States, which brought the company 56% of annual revenue. The share of income in EMEA countries (Europe, Middle East, Africa) and the Asia-Pacific region was 24% and 11%, respectively.

Commenting on the financial statements, Avaya CEO Kevin Kennedy said that the recorded results reflect the strength of the company's IT product portfolio, major victories over competitors for government and corporate contracts in the network equipment, call center and private cloud markets.

Avaya, one of the leaders in the global corporate telephony market, faces growing competition from Cisco and cloud vendors. In 2016, Avaya engaged Goldman Sachs Group and Centerview Partners to assess opportunities to strengthen the financial situation, including through the sale of assets. In March 2017, Avaya announced the sale of the network equipment business to Extreme Networks for $100 million.

Avaya management discussed the terms of the restructuring with creditors. The original goal was to realign the business before bankruptcy, but no agreement was reached. As a result, in January 2017, Avaya filed for bankruptcy.^[5]

2015: Net loss $144 million

In fiscal 2015, Avaya's revenue amounted to just over $4 billion, which is 7% less than a year earlier. Net losses reached $144 million, operating profit - $371 million.

2014: Annual profit $197 million.

In fiscal year 2014, Avaya received revenue of $4.37 billion, a decrease of 4.5% compared to the previous year. Profit turned out to be $197 million.

2013: Loss of $364 million

Avaya's net loss in fiscal year 2013, which ended September 30, 2013, increased by $20 million compared to last fiscal year to $364 million, according to the company's financial report.

The company's revenue in fiscal 2013 decreased by 9% to $4.71 billion. Revenue from the sale of equipment decreased by 12.5%, to $2.38 billion, from the provision of services - by 5.1%, to 2.37 billion.

The company's net profit in the fourth quarter of fiscal year 2013 doubled slightly to $23 million compared to the same period last year. Revenue decreased by 6%, to $1.2 billion. Revenue from the sale of equipment decreased by 5.4%, to 617 million, from the provision of services - by 6.7%, to 583 million dollars.

2010: Loss of $874 million

In the last years of the 2000s, Avaya's business was noticeably damaged due to reduced corporate expenses for telecommunications equipment and the difficult situation in the economy. In the fiscal year that ended for Avaya at the end of September 2010, the company reported revenues of $5.1 billion - 22% more than a year earlier, but almost the same as in 2003. Despite the increase in revenue, Avaya's losses for the entire year amounted to $874 million.

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