“We are just about a couple of months away from becoming profitable. We hope to become profitable in the first half of 2024,” Amagi Media Labs CEO and co-founder Baskar Subramanian told ET.
Amagi’s growth rate has tapered as its revenue base has broadened, with annual recurring revenue (ARR) topping $100 million amidst global movement among broadcasters to shift from hardware to cloud-based distribution.
“We’ve been growing almost 100% a year over the last 3–4 years. At $100 million ARR, you cannot do another 100% growth. We hope to grow by 30–40% going forward,” Subramanian added.
Amagi provides end-to-end, cloud-managed video infrastructure for TV and OTT. Globally, the company works with close to 400 TV networks, including NBC Universal and Warner Bros. Discovery (WBD).
The Bengaluru-headquartered company gets 78% of its revenues from the US, followed by 15% from Europe. Currently, revenue contributions from Asia and India are in the single digits.However, Subramanian expects that to change in the coming years as Indian broadcasters shift from hardware to cloud-based content distribution, which may help companies save up to 40% in costs on average.“All the major television networks in India are developing cloud strategies. We are also seeing the overall concept of consumer streaming content and ad-supported models evolve. In 12 to 18 months, we foresee a lot of transformation taking place in India,” he noted.
Every year, broadcasters worldwide spend up to $50 billion on technology upgrades. In the United States, just 8% of channels are distributed through cloud-based playout, whereas the percentage in India is even less, at under 1%.
Amagi plans to take advantage of the fact that the vast majority of broadcasters have yet to adopt cloud-based playout.
In India, companies like Viacom18 and Zee Entertainment Enterprises have already started using cloud-based playouts for their international TV channels.
“Except for the cameras and the TV sets, everything in the middle can be software. That’s the big opportunity for us to build that next-generation capability as we move forward,” Subramanian stated.
Having raised $300 million in funding from private equity firms in the last two years and attaining the unicorn tag, Amagi has no plans to raise funds unless the company has to make an acquisition.
“We are well capitalised and the company has money in the bank, so we don’t need the money. We are also very close to profitability as a company,” Subramanian said.
Amagi received a $100 million investment from global growth equity firm General Atlantic in November 2022, valuing the company at $1.4 billion. Before that, it secured $95 million in March 2022 from Accel, Norwest Venture Partners, and Avataar Ventures at a $1 billion valuation.
Subramanian said Amagi is open to acquisitions, provided the target company has great talent, technology, and revenue.
Recently, Amagi signed a definitive agreement to acquire Tellyo, a leading real-time live cloud remote production, clipping, editing, and social sharing platform.
Amagi employs close to 1,000 people globally, including over 400 engineers.
“Outside of Facebook, Amazon, Apple, Netflix, and Google, I believe no other firm has as significant media technology expertise in a single group as Amagi has today,” Subramanian said.
