Company Quick10K Filing
Synacor
Price1.46 EPS-0
Shares39 P/E-7
MCap57 P/FCF11
Net Debt-15 EBIT-8
TEV42 TEV/EBIT-6
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-13
10-Q 2020-03-31 Filed 2020-05-15
10-K 2019-12-31 Filed 2020-03-06
10-Q 2019-09-30 Filed 2019-11-07
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-03-14
10-Q 2018-09-30 Filed 2018-11-09
10-Q 2018-06-30 Filed 2018-08-09
10-Q 2018-03-31 Filed 2018-05-10
10-K 2017-12-31 Filed 2018-03-16
10-Q 2017-09-30 Filed 2017-11-14
10-Q 2017-06-30 Filed 2017-08-14
10-Q 2017-03-31 Filed 2017-05-15
10-K 2016-12-31 Filed 2017-03-22
10-Q 2016-09-30 Filed 2016-11-14
10-Q 2016-06-30 Filed 2016-08-15
10-Q 2016-03-31 Filed 2016-05-16
10-K 2015-12-31 Filed 2016-03-22
10-Q 2015-09-30 Filed 2015-11-17
10-Q 2015-06-30 Filed 2015-08-14
10-Q 2015-03-31 Filed 2015-05-14
10-K 2014-12-31 Filed 2015-03-12
10-Q 2014-09-30 Filed 2014-11-14
10-Q 2014-06-30 Filed 2014-08-14
10-Q 2014-03-31 Filed 2014-05-15
10-K 2013-12-31 Filed 2014-03-26
10-Q 2013-09-30 Filed 2013-11-14
10-Q 2013-06-30 Filed 2013-08-13
10-Q 2013-03-31 Filed 2013-05-14
10-K 2012-12-31 Filed 2013-03-26
10-Q 2012-09-30 Filed 2012-11-14
10-Q 2012-06-30 Filed 2012-08-14
10-Q 2012-03-31 Filed 2012-05-15
10-K 2011-12-31 Filed 2012-03-30
8-K 2020-08-11 Earnings, Exhibits
8-K 2020-07-24
8-K 2020-06-29 Enter Agreement, Leave Agreement, Other Events, Exhibits
8-K 2020-06-15
8-K 2020-05-27
8-K 2020-05-27
8-K 2020-05-06
8-K 2020-04-08
8-K 2020-03-03
8-K 2020-03-03
8-K 2020-02-11
8-K 2019-11-06
8-K 2019-08-07
8-K 2019-08-07
8-K 2019-05-16
8-K 2019-05-08
8-K 2019-03-28
8-K 2019-03-13
8-K 2019-03-01
8-K 2018-11-08
8-K 2018-10-01
8-K 2018-08-24
8-K 2018-08-01
8-K 2018-05-24
8-K 2018-05-17
8-K 2018-05-09
8-K 2018-04-24
8-K 2018-03-27
8-K 2018-02-22
8-K 2017-12-31

SYNC 10Q Quarterly Report

Part I. Financial Information
Item 1. Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 sync-20200630xexx311.htm
EX-31.2 sync-20200630xexx312.htm
EX-32.1 sync-20200630xexx321.htm

Synacor Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
1108866442202012201420172020
Assets, Equity
503826142-102012201420172020
Rev, G Profit, Net Income
1581-6-13-202012201420172020
Ops, Inv, Fin

sync-20200630
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Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________________________________________________________________________
FORM 10-Q
_____________________________________________________________________________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
Commission File Number 001-33843
________________________________________________________________________________________________
sync-20200630_g1.jpg
Synacor, Inc.
(Exact name of registrant as specified in its charter)
________________________________________________________________________________________________
Delaware16-1542712
(State or other jurisdiction of incorporation)(I.R.S. Employer Identification No.)

40 La Riviere Drive, Suite 30014202
Buffalo, (Zip Code)
New York
(Address of principal executive offices)
________________________________________________________________________________________________
Registrant’s telephone number, including area code: (716) 853-1362
________________________________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading
Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 Par Value
SYNCThe Nasdaq Stock Market LLC
(voting)
(The Nasdaq Global Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
As of August 10, 2020, there were 39,459,391 shares of the registrant’s common stock outstanding.



Table of Contents
SYNACOR, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
Page

1

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SYNACOR, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED
AS OF JUNE 30, 2020 AND DECEMBER 31, 2019
(In thousands except for share and per share data)
June 30,
2020
December 31,
2019
ASSETS
CURRENT ASSETS:
Cash and cash equivalents$5,978  $10,966  
Accounts receivable—net of allowance of $605 and $585
13,493  20,532  
Prepaid expenses and other current assets3,977  2,989  
Total current assets23,448  34,487  
PROPERTY AND EQUIPMENT, net12,670  14,948  
OPERATING LEASE RIGHT-OF-USE ASSETS, net4,187  4,765  
GOODWILL15,940  15,948  
INTANGIBLE ASSETS, net7,340  8,411  
OTHER ASSETS933  1,319  
Total assets$64,518  $79,878  
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable$10,472  $12,583  
Accrued expenses and other current liabilities3,413  5,878  
Current portion of deferred revenue5,349  6,509  
Current portion of long-term debt and finance leases1,027  2,529  
Current portion of operating lease liabilities2,179  2,165  
Total current liabilities22,440  29,664  
LONG-TERM PORTION OF DEBT AND FINANCE LEASES815  729  
LONG-TERM PORTION OF OPERATING LEASE LIABILITIES2,151  2,846  
DEFERRED REVENUE1,907  2,366  
DEFERRED INCOME TAXES334  275  
OTHER LONG-TERM LIABILITIES348  334  
Total liabilities27,995  36,214  
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDERS’ EQUITY:
Preferred stock – par value $0.01 per share; authorized 10,000,000 shares; none issued
    
Common stock – par value $0.01 per share; authorized 100,000,000 shares; 40,353,854 shares issued and 39,449,319 shares outstanding at June 30, 2020 and 40,075,475 shares issued and 39,201,477 shares outstanding at December 31, 2019
404  401  
Treasury stock – at cost, 904,535 shares at June 30, 2020 and 873,998 shares at December 31, 2019
(1,971) (1,931) 
Additional paid-in capital147,233  146,460  
Accumulated deficit(108,454) (100,747) 
Accumulated other comprehensive loss(689) (519) 
Total stockholders’ equity36,523  43,664  
Total liabilities and stockholders’ equity$64,518  $79,878  
The accompanying notes are an integral part of these condensed consolidated financial statements.
2

Table of Contents
SYNACOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands except for share and per share data)
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
REVENUE$18,176  $31,849  $38,759  $63,673  
COSTS AND OPERATING EXPENSES:
Cost of revenue (exclusive of depreciation and amortization shown separately below)9,036  17,152  19,765  33,658  
Technology and development (exclusive of depreciation and amortization shown separately below)2,943  4,577  6,051  9,123  
Sales and marketing3,803  5,550  8,171  11,541  
General and administrative (exclusive of depreciation and amortization shown separately below)3,274  3,955  7,740  8,420  
Depreciation and amortization2,225  2,567  4,439  5,002  
Total costs and operating expenses21,281  33,801  46,166  67,744  
LOSS FROM OPERATIONS(3,105) (1,952) (7,407) (4,071) 
OTHER INCOME (EXPENSE), net175  (207) 342  9  
INTEREST EXPENSE(50) (55) (109) (119) 
LOSS BEFORE INCOME TAXES(2,980) (2,214) (7,174) (4,181) 
PROVISION FOR INCOME TAXES202  273  533  550  
NET LOSS$(3,182) $(2,487) $(7,707) $(4,731) 
NET LOSS PER SHARE:
Basic$(0.08) $(0.06) $(0.19) $(0.12) 
Diluted$(0.08) $(0.06) $(0.19) $(0.12) 
WEIGHTED AVERAGE SHARES USED TO COMPUTE NET LOSS PER SHARE:
Basic39,978,861  39,056,381  39,828,300  39,047,561  
Diluted39,978,861  39,056,381  39,828,300  39,047,561  
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SYNACOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS – UNAUDITED
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands)
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Net loss$(3,182) $(2,487) $(7,707) $(4,731) 
Other comprehensive loss:
Changes in foreign currency translation adjustment(12) 122  (170) (15) 
Comprehensive loss$(3,194) $(2,365) $(7,877) $(4,746) 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SYNACOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY – UNAUDITED
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020
(In thousands except for share data)


Common StockTreasury StockAdditional
Paid-in
Capital
Accumulated
Deficit
Accumulated Other Comprehensive LossTotal
SharesAmountSharesAmount
BALANCE—April 1, 202040,266,348  $403  904,535  $(1,971) $146,844  $(105,272) $(677) $39,327  
Stock-based compensation cost—  —  —  —  390  —  —  390  
Vesting of restricted stock units, net of treasury stock87,506  1      (1) —  —    
Net loss—  —  —  —  —  (3,182) —  (3,182) 
Other comprehensive loss—  —  —  —  —  —  (12) (12) 
BALANCE—June 30, 202040,353,854  $404  904,535  $(1,971) $147,233  $(108,454) $(689) $36,523  


Common StockTreasury StockAdditional
Paid-in
Capital
Accumulated
Deficit
Accumulated Other Comprehensive LossTotal
SharesAmountSharesAmount
BALANCE—January 1, 202040,075,475  $401  873,998  $(1,931) $146,460  $(100,747) $(519) $43,664  
Stock-based compensation cost—  —  —  —  776  —  —  776  
Vesting of restricted stock units, net of treasury stock278,379  3  30,537  (40) (3) —  —  (40) 
Net loss—  —  —  —  —  (7,707) —  (7,707) 
Other comprehensive loss—  —  —  —  —  —  (170) (170) 
BALANCE—June 30, 202040,353,854  $404  904,535  $(1,971) $147,233  $(108,454) $(689) $36,523  
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SYNACOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY – UNAUDITED
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2019
(In thousands except for share data)


Common StockTreasury StockAdditional
Paid-in
Capital
Accumulated
Deficit
Accumulated Other Comprehensive LossTotal
SharesAmountSharesAmount
BALANCE—April 1, 201939,905,289  $399  852,607  $(1,899) $145,123  $(93,970) $(479) $49,174  
Exercise of common stock options1,708  —  —  —  3  —  —  3  
Stock-based compensation cost—  —  —  —  338  —  —  338  
Vesting of restricted stock units, net of treasury stock10,522  —  3,766  (6) —  —  —  (6) 
Net loss—  —  —  —  —  (2,487) —  (2,487) 
Other comprehensive income—  —  —  —  —  —  122  122  
BALANCE—June 30, 201939,917,519  $399  856,373  $(1,905) $145,464  $(96,457) $(357) $47,144  


Common StockTreasury StockAdditional
Paid-in
Capital
Accumulated
Deficit
Accumulated Other Comprehensive LossTotal
SharesAmountSharesAmount
BALANCE—January 1, 201939,880,054  $399  852,482  $(1,899) $144,739  $(91,726) $(342) $51,171  
Exercise of common stock options26,527  —  —  —  40  —  —  40  
Stock-based compensation cost—  —  —  —  685  —  —  685  
Vesting of restricted stock units, net of treasury stock10,938  —  3,891  (6) —  —  —  (6) 
Net loss—  —  —  —  —  (4,731) —  (4,731) 
Other comprehensive loss—  —  —  —  —  —  (15) (15) 
BALANCE—June 30, 201939,917,519  $399  856,373  $(1,905) $145,464  $(96,457) $(357) $47,144  
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SYNACOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
FOR THE SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands)
Six Months Ended
June 30,
20202019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss$(7,707) $(4,731) 
Adjustments to reconcile net loss to net cash and cash equivalents
provided by (used in) operating activities:
Depreciation and amortization5,512  5,473  
Asset impairment  226  
Stock-based compensation expense760  655  
Provision for deferred income taxes59  40  
Change in allowance for doubtful accounts20  34  
Changes in operating assets and liabilities:
Accounts receivable, net7,019  3,639  
Prepaid expenses and other assets(618) (23) 
Operating lease right-of-use assets and liabilities, net(102) 36  
Accounts payable, accrued expenses and other liabilities(4,170) (4,030) 
Deferred revenue(1,619) 193  
Net cash (used in) provided by operating activities(846) 1,512  
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment(1,972) (2,444) 
Net cash used in investing activities(1,972) (2,444) 
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments on long-term debt and finance leases(1,968) (1,585) 
Proceeds from exercise of common stock options  40  
Purchase of treasury stock and shares received to satisfy minimum tax
withholdings
(40) (6) 
Net cash used in financing activities(2,008) (1,551) 
Effect of exchange rate changes on cash and cash equivalents(162) (21) 
NET DECREASE IN CASH AND CASH EQUIVALENTS(4,988) (2,504) 
Cash and cash equivalents, beginning of period10,966  15,921  
Cash and cash equivalents, end of period$5,978  $13,417  
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest$108  $120  
Cash paid for income taxes$314  $403  
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Minimum long-term debt and finance lease payments in accounts payable$267  $88  
Accrued property and equipment expenditures$5  $188  
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SYNACOR, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
AS OF JUNE 30, 2020 AND DECEMBER 31, 2019, AND
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
1. The Company and Summary of Significant Accounting Principles
Synacor, Inc., together with its consolidated subsidiaries (collectively, the “Company” or “Synacor”), is a digital technology company that provides email and collaboration software, cloud-based identity management platforms, managed web and mobile portals, and advertising solutions. The Company’s customers include communications providers, media companies, government entities and enterprises. Synacor is a trusted partner for enterprise software platforms and monetization solutions that Synacor delivers through public and private cloud software-as-a-service, software licensing, and professional services. Synacor enables clients to deepen their engagement with their consumers and users.
Basis of Presentation
The interim unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of the Company’s management, the interim unaudited condensed consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position for the periods presented. These interim unaudited condensed consolidated financial statements are not necessarily indicative of the results expected for the full fiscal year or for any subsequent period.
The accompanying condensed consolidated balance sheet as of December 31, 2019 was derived from the audited financial statements as of that date, but does not include all the information and footnotes required by U.S. GAAP. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.
Accounting Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Actual results could differ materially from these estimates and judgments.
Many of our estimates require increased judgment due to the significant volatility, uncertainty and economic disruption of the recent global COVID-19 pandemic. We will continue to monitor the effects of the COVID-19 pandemic, and our estimates and judgments may change materially as new events occur or additional information becomes available to us.
Concentrations of Risk
As of June 30, 2020 and December 31, 2019, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:
Accounts Receivable
June 30, 2020December 31, 2019
Portal & Advertising Customer A*13 %
* - Less than 10%
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For the three and six months ended June 30, 2020 and 2019, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:
Revenue
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Google search12 %12 %*12 %
Portal & Advertising Customer A*12 %*13 %
* - Less than 10%
For the three and six months ended June 30, 2020 and 2019, the following customers received revenue-share payments equal to or exceeding 10% of the Company’s cost of revenue:
Cost of Revenue
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Portal & Advertising Customer B*28 %*29 %
* - Less than 10%
Recent Accounting Pronouncements
Not Yet Adopted
In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2016-13 ("ASU 2016-13") Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to certain available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes result in earlier recognition of credit losses. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption is permitted. The Company does not believe the impact of adopting this standard will be material to its consolidated financial statements and related disclosures.
Recently Adopted
In August 2018, the FASB issued ASU No. 2018-15, Customer’s Accounting For Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. Adoption of this guidance is required for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years and early adoption is permitted. The amendments will be applied prospectively to all implementation costs incurred after adoption. There was no impact to the Company's condensed consolidation financial statements for the three and six months ended June 30, 2020 as a result of adopting this standard update on January 1, 2020.
The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined to be either not applicable, or had or are expected to have minimal impact on the Company’s financial statements and related disclosures.
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2. Revenue from Contracts with Customers
The Company generates all of its revenue from contracts with customers. Many of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices of software licenses are typically estimated using the residual approach. Standalone selling prices of services are typically estimated based on observable transactions when these services are sold on a standalone basis. The Company usually expects payment within 30 to 90 days from the invoice date (fulfillment of performance obligations or per contract terms). None of the Company’s contracts as of June 30, 2020 contained a significant financing component. Differences between the amount of revenue recognized and the amount invoiced are recognized as deferred revenue.
Disaggregation of revenue
The following table provides information about disaggregated revenue for the three and six months ended June 30, 2020 and 2019 by the timing of revenue recognition, and includes a reconciliation of the disaggregated revenue by reportable segment (in thousands):
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Software & Services
Products and services transferred over time$8,063  $8,388  $16,393  $17,263  
Products transferred at a point in time2,852  2,200  5,584  4,483  
Total Software & Services