US elections are just the ticket for blinkx
Shares in blinkx, the video search engine, have surged 22 per cent after the company raised profit forecasts in the wake of the US elections.
The company said that it expected revenue for the year to be between $180 million (£114.7 million) and $185 million, which is more than 10 per cent higher than analysts had pencilled in.
It is the second profit upgrade in four months as internet users searched for videos of the Olympic Games and US election coverage. blinkx also benefited from a faster integration of companies it has acquired including PVMG and Burst Media.
Shares added 15p to 83p as a result of the “strong” third quarter commentary and raised guidance. The shares jumped ten-fold between 2010 and 2011 but fell sharply last year as it struggled to reap the benefits of its acquisitions.
blinkx is a spin-off from Autonomy, the former FTSE 100 software company, and was championed by Mike Lynch, who remains a non-executive director of the smaller company.
Often dubbed the consumer arm of Autonomy’s stable, blinkx was spun out in 2006 and is an example of the type of business that Dr Lynch wants to back with his new Invoke Capital fund. He said last week that “visual” technologies are of interest to Invoke, which has $1 billion to invest in creating a new generation of British high-tech stars.
Hewlett-Packard, which acquired Autonomy and has since accused Dr Lynch of inflating the value of the business, inherited a residual stake in blinkx of about 10 per cent. Dr Lynch also holds a 6 per cent holding in the business.
blinkx has also benefited from a switch at the top as Suranga Chandratillake, founder and chief executive of the company, switched roles with Subhransu “Brian” Mukherjee, his chief operating officer.
Mr Mukherjee, an Indian-born Silicon Valley veteran, joined the business as part of the PVMG deal and was expected to bring more operational focus to the company.
The success of blinkx was due to be repeated with Aurasma, Autonomy’s augmented reality arm and sponsor of Tottenham Hotspur FC’s shirts, prior to the HP takeover. Dr Lynch had planned to spin off the business but HP has since absorbed the unit into the wider Autonomy business and cut a large portion of its staff.
Martina King, Aurasma’s managing director, jumped ship to Cambridge start-up Featurespace, which counts Dr Lynch and Betfair among its shareholders, and has since poached Aurasma’s management team. The company’s software helps to predict an online user’s behaviour and is used by Betfair to spot fraudulent activity.