8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
	FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): March 8, 2016
Qumu Corporation
(Exact name of Registrant as Specified in its Charter)
	Minnesota
(State Or Other Jurisdiction Of Incorporation)

000-20728	41-1577970
(Commission File Number)	(I.R.S. Employer Identification No.)
510 1st Avenue North, Suite 305
Minneapolis, MN	55403
(Address Of Principal Executive Offices)	(Zip Code)

	(612) 638-9100
Registrant’s Telephone Number, Including Area Code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

Items under Sections 1 and 3 through 8 are not applicable and therefore omitted.

ITEM 2.02RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

Qumu Corporation (the “Company”) hereby furnishes as Exhibit 99.1 a press release issued on March 8, 2016 disclosing material non-public information regarding its results of operations for the quarter and year ended December 31, 2015 and hereby furnishes as Exhibit 99.2 statements of Vern Hanzlik, its President and Chief Executive Officer, and Peter J. Goepfrich, its Chief Financial Officer, made on March 9, 2016 at a telephone conference relating to the quarter and year ended December 31, 2015 results.

ITEM 9.01FINANCIAL STATEMENTS AND EXHIBITS.

Exhibit No.	Description
99.1	Press Release issued on March 8, 2016.
99.2	Statements of Vern Hanzlik, President and Chief Executive Officer, and Peter J. Goepfrich, Chief Financial Officer at a telephone conference held on March 9, 2016.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	QUMU CORPORATION
	By:	/s/ Peter J. Goepfrich
		Peter J. Goepfrich
		Chief Financial Officer
Date: March 9, 2016

EX-99.1

EXHIBIT 99.1

Qumu Announces Fourth Quarter and Full Year 2015 Results

Record Quarterly Revenue of $10.1 Million, a 21% year-over-year increase

Full Year 2015 Revenue of $34.5 Million, a 30% year-over-year increase

Initiates Fiscal 2016 Guidance

Conference Call Wednesday, March 9 at 10:00 a.m. ET

Minneapolis, MN – March 8, 2016 – Qumu Corporation (NASDAQ: QUMU) today reported financial results for the fourth quarter and year ended December 31, 2015.

Fourth quarter revenue was $10.1 million, a 21% increase compared to the fourth quarter 2014. Full year 2015 revenue was $34.5 million, a 30% increase compared to last year. Fourth quarter net loss per share was $(0.50) compared to $(0.87) in the fourth quarter 2014. Fourth quarter 2015 results included severance expense of $743,000 or $(0.08) per share, a loss on a third party license agreement of $1.2 million or $(0.13) per share, and a tax benefit of $357,000 or $0.04 per share.

Fourth quarter adjusted EBITDA (a non-GAAP measure) was a loss of $3.7 million, compared to a loss of $7.2 million for the fourth quarter of 2014 and a loss of $6.2 million for the third quarter of 2015.

“I am proud of our performance in the fourth quarter. Our team delivered on revenue, gross margin and expense management while growing our customer base and increasing our technology lead. We are the clear leader in the enterprise video market, as can be seen from Qumu’s consistently high leadership ratings in analyst reports from Gartner, Forrester, Aragon, Frost & Sullivan, and our addressable market continues to grow within the segments we target: financial services, pharmaceutical, manufacturing, retail and other Global 5000 businesses,” said Vern Hanzlik, Qumu’s President and Chief Executive Officer. “We will continue to improve our financial metrics without compromising our ability to grow. Our focus on the enterprise video market is our key differentiator, resulting in software solutions that deliver the best user experience to our customers.”

Other Information

• Fourth quarter subscription, maintenance and support revenue was $5.2 million compared to $4.2 million in the fourth quarter 2014. Full year subscription, maintenance and support revenue was $18.8 million compared to $12.2 million last year.

• Fourth quarter gross margin was 57% compared to 46% the fourth quarter 2014. Full year 2015 gross margin was 49% compared to 45% last year.

• Total headcount was 192 as of December 31, 2015 compared to 194 as of September 30, 2015 and 222 as of December 31, 2014.

• Cash, marketable securities and restricted cash were $13.3 million as of December 31, 2015, compared to $15.1 million as of September 30, 2015, reflecting the fourth quarter operating loss and the impact on cash from changes in working capital.

Guidance

For the first quarter of 2016, revenue is expected to be in the range of $8.0 million to $9.0 million. First quarter net loss per diluted share is expected to be in the range of $(0.53) to $(0.49) with fully diluted weighted average shares outstanding of approximately 9.2 million shares. Adjusted EBITDA is expected to be in the range of a loss of $3.5 million to $3.0 million compared to a loss of $8.7 million in the first quarter 2015.

1

For the full year of 2016, revenue is expected to be in the range of $40.0 million to $43.0 million, representing approximately 16% to 25% growth over 2015. Gross margins are expected to improve from the low to mid 50s early in the year to the mid to high 60s late in the year. Full year net loss per diluted share is expected to be in the range of $(1.15) to $(1.00) with fully diluted weighted average shares outstanding of approximately 9.2 million shares. Adjusted EBITDA is expected to be in the range of a loss of $5.5 million to $4.0 million compared to a loss of $24.5 million in fiscal 2015. The Company expects a tax benefit of $300,000 in fiscal 2016. Additionally, the Company expects that it will be cash flow breakeven the second half of 2016.

Conference Call

The Company has scheduled a conference call and webcast to review its fourth quarter and full year 2015 results tomorrow, March 9, 2016 at 10:00 a.m. Eastern Time. The dial-in number for the conference call is 877-456-6914 for domestic participants and 929-387-3794 for international participants. Investors can also access a webcast of the live conference call by linking through the investor relations section of the Qumu website, www.qumu.com. Webcasts will be archived on Qumu’s website.

Non-GAAP Information

To supplement the Company's condensed consolidated financial statements presented on a GAAP basis, the Company uses adjusted EBITDA (a non-GAAP measure), which excludes certain items presented under GAAP. Adjusted EBITDA excludes items related to stock-based compensation, depreciation and amortization, interest income and expense, and the impact of income-based taxes.

The Company uses both GAAP and non-GAAP measures when planning, monitoring, and evaluating the Company’s performance. The Company believes that adjusted EBITDA is useful to investors because it provides supplemental information that allows investors to review the Company's results of operations from the same perspective as management and the Company's board of directors. Non-GAAP results are presented for supplemental informational purposes only for understanding our operating results. The non-GAAP results should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from non-GAAP measures used by other companies.

See the attached Supplemental Financial Information for a reconciliation of operating loss, a GAAP measure, to adjusted EBITDA, a non-GAAP measure, for the three months ended December 31, 2015 and December 31, 2014 and full year 2015 and 2014, as well as other prior quarterly periods.

Forward-Looking Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” or “estimate” or comparable terminology are intended to identify forward-looking statements. Such forward-looking statements include, for example, statements about: the Company’s future revenue and operating performance, cash balances, future product mix or the timing of recognition of revenue; the demand for the Company’s products or software; and the success of cost reduction measures. The statements made by the Company are based upon management’s current expectations and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include the risk factors described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 and other factors set forth in the Company’s filings with the Securities and Exchange Commission.

About Qumu

Video is today’s document. Qumu Corporation (NASDAQ: QUMU) provides the tools businesses need to create, manage, secure, deliver and measure the success of their videos. Qumu's innovative solutions release the power in video to engage and empower employees, partners and clients. Organizations around the world realize the greatest possible value from video they create and publish using Qumu. Whatever the audience size, viewer device or network configuration, Qumu solutions arehow business does video. Additional information can be found at www.qumu.com.

Investor Contact:

Peter Goepfrich, CFO                

Qumu Corporation                

612-638-9096

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QUMU CORPORATION

Condensed Consolidated Statements of Operations

(unaudited - in thousands, except per share data)

	Three Months Ended   December 31,						Year Ended   December 31,
	2015			2014			2015			2014
Revenues:
Software licenses and appliances	$	2,486		$	3,260		$	9,456		$	11,363
Service	7,633			5,075			24,998			15,158
Total revenues	10,119			8,335			34,454			26,521
Cost of revenues:
Software licenses and appliances	953			966			2,949			3,816
Service	3,409			3,502			14,550			10,656
Total cost of revenues	4,362			4,468			17,499			14,472
Gross profit	5,757			3,867			16,955			12,049
Operating expenses:
Research and development	2,181			2,897			10,689			9,506
Sales and marketing	3,720			5,474			17,994			17,991
General and administrative	4,603			3,732			16,878			12,626
Amortization of purchased intangibles	199			182			798			652
Total operating expenses	10,703			12,285			46,359			40,775
Operating loss	(4,946		)	(8,418		)	(29,404		)	(28,726		)
Other income (expense):
Interest, net	(14		)	27			7			60
Other, net	26			(147		)	(131		)	(241		)
Total other income (expense), net	12			(120		)	(124		)	(181		)
Loss before income taxes	(4,934		)	(8,538		)	(29,528		)	(28,907		)
Income tax benefit	(357		)	(626		)	(839		)	(6,564		)
Net loss from continuing operations	(4,577		)	(7,912		)	(28,689		)	(22,343		)
Net income (loss) from discontinued operations, net of tax	—			(542		)	(10		)	13,823
Net loss	$	(4,577	)	$	(8,454	)	$	(28,699	)	$	(8,520	)
Net income (loss) per basic and diluted share:
Net loss from continuing operations per share	$	(0.50	)	$	(0.87	)	$	(3.11	)	$	(2.53	)
Net income (loss) from discontinued operations per share	—			(0.06		)	—			1.57
Net loss per share	$	(0.50	)	$	(0.93	)	$	(3.11	)	$	(0.96	)
Basic and diluted weighted average shares outstanding	9,243			9,114			9,235			8,836

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QUMU CORPORATION

Condensed Consolidated Balance Sheets

(in thousands)

Assets	December 31, 2015			December 31, 2014
Current assets:	(unaudited)
Cash and cash equivalents	$	7,072		$	11,684
Marketable securities	6,249			23,486
Restricted cash	—			2,300
Receivables, net	11,257			10,090
Prepaid income taxes	659			301
Prepaid expenses and other current assets	3,392			3,801
Deferred income taxes	—			64
Current assets from discontinued operations	—			1,026
Total current assets	28,629			52,752
Property and equipment, net	2,942			1,899
Intangible assets, net	11,032			13,384
Goodwill	8,103			8,525
Other assets, non-current	3,706			3,617
Total assets	$	54,412		$	80,177
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and other accrued liabilities	$	3,864		$	3,396
Accrued compensation	4,014			6,222
Deferred revenue	10,413			9,015
Deferred income taxes	—			110
Income taxes payable	—			53
Deferred rent	270			133
Financing obligations	502			—
Current liabilities from discontinued operations	50			448
Total current liabilities	19,113			19,377
Long-term liabilities:
Deferred revenue, non-current	2,215			1,047
Income taxes payable, non-current	9			8
Deferred tax liability, non-current	575			1,071
Deferred rent, non-current	998			401
Financing obligations, non-current	519			—
Other non-current liabilities	226			—
Total long-term liabilities	4,542			2,527
Total liabilities	23,655			21,904
Stockholders’ equity:
Common stock	92			91
Additional paid-in capital	65,484			63,566
Accumulated deficit	(33,298		)	(4,599		)
Accumulated other comprehensive loss	(1,521		)	(785		)
Total stockholders’ equity	30,757			58,273
Total liabilities and stockholders’ equity	$	54,412		$	80,177

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QUMU CORPORATION

Condensed Consolidated Statements of Cash Flows

(unaudited - in thousands)

	Year Ended   December 31,
	2015			2014
Cash flows used in operating activities:
Net loss	$	(28,699	)	$	(8,520	)
Net (income) loss from discontinued operations, net of tax	10			(13,823		)
Net loss from continuing operations	(28,689		)	(22,343		)
Adjustments to reconcile net loss to net cash used in continuing operating activities:
Depreciation and amortization	3,118			2,049
Stock-based compensation	1,834			1,841
Loss on disposal of property and equipment	108			102
Deferred income taxes	(564		)	(126		)
Current income tax benefit resulting from income generated from discontinued operations	—			(6,337		)
Changes in operating assets and liabilities:
Receivables	(1,331		)	(5,679		)
Prepaid income taxes / income taxes payable	(378		)	1,068
Prepaid expenses and other assets	748			(2,032		)
Trade accounts payable and other accrued liabilities	443			1,189
Accrued compensation	(2,184		)	686
Deferred revenue	2,729			5,499
Deferred rent	48			(105		)
Other non-current liabilities	226			—
Net cash used in continuing operating activities	(23,892		)	(24,188		)
Net cash provided by discontinued operating activities	665			1,544
Net cash used in operating activities	(23,227		)	(22,644		)
Cash flows provided by (used in) investing activities:
Purchases of marketable securities	(9,500		)	(33,499		)
Sales and maturities of marketable securities	26,715			23,250
Purchases of property and equipment	(635		)	(1,051		)
Proceeds from sale of property and equipment	43			—
Cash paid for acquisition of business, net of cash acquired	—			(11,556		)
Net cash provided by (used in) continuing investing activities	16,623			(22,856		)
Net cash provided by (used in) discontinued investing activities	2,300			19,676
Net cash provided by investing activities	18,923			(3,180		)
Cash flows used in financing activities:
Common stock repurchases to settle employee withholding liability	(50		)	(99		)
Principal payments on financing obligations	(320		)	—
Proceeds from employee stock plans	142			193
Net cash provided by (used in) continuing financing activities	(228		)	94
Net cash used in discontinued financing activities	—			(59		)
Net cash provided by (used in) financing activities	(228		)	35
Effect of exchange rate changes on cash	(80		)	(252		)
Net decrease in cash and cash equivalents	(4,612		)	(26,041		)
Cash and cash equivalents, beginning of year	11,684			37,725
Cash and cash equivalents, end of year	$	7,072		$	11,684

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QUMU CORPORATION

Supplemental Financial Information

(unaudited - in thousands)

A summary of revenue is as follows:

	Three Months Ended   December 31,				Year Ended   December 31,
	2015		2014		2015		2014
Software licenses and appliances	$	2,486	$	3,260	$	9,456	$	11,363
Services
Subscription, maintenance and support	5,240		4,235		18,804		12,229
Professional services and other	2,393		840		6,194		2,929
Total services	7,633		5,075		24,998		15,158
Total revenue	$	10,119	$	8,335	$	34,454	$	26,521

	Three Months Ended
	Mar 31, 2014		Jun 30, 2014		Sep 30, 2014		Dec 31, 2014		Mar 31, 2015		Jun 30, 2015		Sep 30, 2015		Dec 31, 2015
Software licenses and appliances	$	1,196	$	4,714	$	2,193	$	3,260	$	984	$	2,719	$	3,267	$	2,486
Services
Subscription, maintenance and support	2,058		2,936		3,000		4,235		4,112		4,592		4,860		5,240
Professional services and other	675		754		660		840		873		1,453		1,475		2,393
Total services	2,733		3,690		3,660		5,075		4,985		6,045		6,335		7,633
Total revenue	$	3,929	$	8,404	$	5,853	$	8,335	$	5,969	$	8,764	$	9,602	$	10,119

Additional information regarding amounts historically classified as selling, general and administrative expense is as follows:

	Three Months Ended
	Mar 31, 2014		Jun 30, 2014		Sep 30, 2014		Dec 31, 2014		Mar 31, 2015		Jun 30, 2015		Sep 30, 2015		Dec 31, 2015
Sales and marketing	3,759		4,601		4,157		5,474		4,828		4,740		4,706		3,720
General and administrative	2,758		2,820		3,316		3,732		4,364		3,558		4,353		4,603
Total selling, general and administrative	$	6,517	$	7,421	$	7,473	$	9,206	$	9,192	$	8,298	$	9,059	$	8,323

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QUMU CORPORATION

Supplemental Financial Information

(unaudited - in thousands)

A reconciliation from GAAP results to adjusted EBITDA is as follows:

	Three Months Ended   December 31,						Year Ended   December 31,
	2015			2014			2015			2014
Operating loss	$	(4,946	)	$	(8,418	)	$	(29,404	)	$	(28,726	)
Depreciation and amortization expense:
Depreciation and amortization in cost of revenues	26			15			100			53
Depreciation and amortization in operating expenses	286			211			952			694
Total depreciation and amortization expense	312			226			1,052			747
Amortization of intangibles included in cost of revenues	315			230			1,268			650
Amortization of intangibles included in operating expenses	199			182			798			652
Total amortization of intangibles expense	514			412			2,066			1,302
Total depreciation and amortization expense	826			638			3,118			2,049
EBITDA	(4,120		)	(7,780		)	(26,286		)	(26,677		)
Stock-based compensation expense:
Stock-based compensation included in cost of revenues	44			32			159			55
Stock-based compensation included in operating expenses	360			528			1,675			1,786
Total stock-based compensation expense	404			560			1,834			1,841
Adjusted EBITDA	$	(3,716	)	$	(7,220	)	$	(24,452	)	$	(24,836	)

	Three Months Ended
	Mar 31, 2014			Jun 30, 2014			Sep 30, 2014			Dec 31, 2014			Mar 31, 2015			Jun 30, 2015			Sep 30, 2015			Dec 31, 2015
Operating loss	$	(7,308	)	$	(5,679	)	$	(7,321	)	$	(8,418	)	$	(9,999	)	$	(7,084	)	$	(7,375	)	$	(4,946	)
Depreciation and amortization expense:
Depreciation and amortization in cost of revenues	5			7			26			15			22			26			26			26
Depreciation and amortization in operating expenses	153			166			164			211			211			212			243			286
Total depreciation and amortization expense	158			173			190			226			233			238			269			312
Amortization of intangibles included in cost of revenues	140			140			140			230			316			317			320			315
Amortization of intangibles included in operating expenses	157			156			157			182			199			200			200			199
Total amortization of intangibles expense	297			296			297			412			515			517			520			514
Total depreciation and amortization expense	455			469			487			638			748			755			789			826
EBITDA	(6,853		)	(5,210		)	(6,834		)	(7,780		)	(9,251		)	(6,329		)	(6,586		)	(4,120		)
Stock-based compensation expense:
Stock-based compensation included in cost of revenues	7			11			5			32			36			38			41			44
Stock-based compensation included in operating expenses	342			424			492			528			532			462			321			360
Total stock-based compensation expense	349			435			497			560			568			500			362			404
Adjusted EBITDA	$	(6,504	)	$	(4,775	)	$	(6,337	)	$	(7,220	)	$	(8,683	)	$	(5,829	)	$	(6,224	)	$	(3,716	)

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EX-99.2

Exhibit 99.2

Qumu Corporation

Q4 2015

Conference Call

March 9, 2016

Operator

[Introduction]

Vern Hanzlik

Good morning everyone and thank you for joining us for our fourth quarter 2015 earnings conference call.

Some of our comments today may also contain forward-looking statements which are subject to risks, uncertainties and assumptions. Should any of these materialize or should our assumptions prove to be incorrect, actual Company results could differ materially from these forward-looking statements. A description of our risks, uncertainties and assumptions and other factors that could affect our financial results are included in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q.

During our call, we may offer additional metrics to provide further insight into our business or results. This detail may or may not be provided in the future. We may also reference certain unreleased services or features not yet available, and we cannot guarantee the timing or availability of these services or features. So we recommend customers listening today make purchase decisions based on services or features currently available.

With me today is Peter Goepfrich, our CFO. I will begin the call touching on a few fourth quarter financial highlights. Peter will then provide some additional financial commentary. From there I will provide other operational highlights and comments on our market. After that we will open the call to questions.

Fourth Quarter Financial Highlights

• In the fourth quarter our team delivered on revenue growth, margins and expense management.

◦ We generated record quarterly revenue of $10.1 million, an increase of 21%, compared to the fourth quarter 2014 and full year revenue of $34.5 million an increase of 30%.

◦ Fourth quarter gross margin was 57% and full year gross margin was 49%.

◦ Our expense reduction program implemented in the third quarter has enabled us to better align our expense structure with revenue. The expense reductions affected all functional areas and included both headcount and outside service providers.

◦ We are now better positioned to improve our financial metrics without compromising our ability to grow.

• Geographically, the Americas and EMEA markets continued to show strong adoption of enterprise video and our enterprise business performed well.

• In APAC we continued to make progress developing a pipeline through our partnership with Fujitsu and other partners.

• One of our Americas wins for the quarter was oneof the world’s leading pharmaceuticalcompanies. They have thousands of employees and like many businesses they have invested in an ‘inside the firewall’ video platform to maximize employee engagement and collaboration. This company will run live events with our video platform and is expected to expand to the next level with mobile and user generated content.

• In EMEA, we gained another large pharmaceutical customer. Both of these wins are at the higher end of Qumu’s historic deal sizes.

• Additionally, seven of our new or expanded customers in fourth quarter were in the financial services industry, providing more evidence of our continuing success in this segment. Overall, twelve of the 50 largest global financial services institutions by revenue are now Qumu customers.

For additional financial commentary, I will now turn the call over to Peter.

Peter Goepfrich

Thank you Vern.

I will comment on a few changes we made to what information is provided in our earnings release. The changes were made to increase transparency and provide information that we use to plan, monitor and evaluate our financial results.

• In regards to revenue, as the Company continues to transition to more revenue that is recurring in nature, we have provided supplemental information for subscription, maintenance and support revenue.

◦ Fourth quarter subscription, maintenance and support revenue was $5.2 million compared to $4.2 million in the fourth quarter 2014. Full year subscription, maintenance and support revenue was $18.8 million compared to $12.2 million last year.

• In regards to overall operating expenses and operating results:

◦ We have separated Sales and Marketing, and General and Administrative expense for reporting purposes.

◦ Additionally, we have provided supplemental information for Adjusted EBITDA, a non-GAAP measure. Adjusted EBITDA excludes items related to stock-based compensation, depreciation and amortization, interest income and expense, and the impact of income-based taxes.

• In addition to the new information we are providing, we will no longer specifically call out total bookings because total bookings includes a variety of items long-term in nature and it does not reflect the mix of the underlying bookings. We believe the supplement revenue information now provided is more insightful to our performance.

◦ That said, for this call in an effort to error on the side of transparency, total bookings in the fourth quarter were $12.4 million.

Again, the changes noted were made to increase transparency and provide information that we use to plan, monitor and evaluate our financial results. As we continue to refine and enhance our reporting, we may provide additional supplemental information in the future.

Moving on to few specific operating expense items.

• Total operating expenses in the fourth quarter were $10.7 million a decrease of $1.4 million compared with the third quarter 2015.

◦ Fourth quarter 2015 results included severance expense of $743,000 and a loss on a third party license agreement of $1.2 million.

◦ Third quarter 2015 results included severance expense of $784,000 and an equipment operating lease loss of $1 million relating to equipment that the we no longer plan to utilize.

As noted in yesterday’s press release, with the expected increased revenue and continued focus on a significant improvement in Adjusted EBITDA, we expect that we will be cash flow breakeven the second half of 2016.

Now back to Vern with additional operating highlights and comments on our market.

Vern Hanzlik

Thanks Peter.

Let me review some our key operational highlights and then we will open the call up for questions.

• We are focusing on three themes as we approach the 2016 operating plan. These themes are becoming part our company’s DNA: Mindfulness in how we run our business; innovation as the core of our software strategy; and leadership in how businesses use video.

• Further, Qumu’s focus on user experience continues to set the bar high against our competitors. Through multiple successful customer proof-of-concept engagements in the 4th quarter, Qumu again has demonstrated that we are the only vendor with technology and solutions available in the market today that are proven to scale to meet the business video challenge. We continue to win business because customers demand the choice, control and completeness of solutions that we can offer.

• In fourth quarter, close to 80% of our new contracts were on-premise transactions, both for new and existing customers. However we continue to see a trend towards an increasing percentage of cloud and hybrid deployments in our growing pipeline for 2016.

• Additionally, in 2015 our global renewal rate for maintenance and support, term contracts and SaaS contracts where greater than 90%.

• In 2016, we will continue to advance our cloud and hybrid offerings, which are the foundation of our next generation platform. This new software platform will expand on our current capabilities enabling our customers to use video to enhance their work product even more broadly - every day, everywhere and anytime.

• We also announced a new partnership with Pexip; a new Unified Communications leader that is revolutionizing the way people work and collaborate visually. We are very excited about this global partnership. The integration of our software with Pexip creates a huge value-add for our collective customers.

Enterprise Customers

• We continue to see enterprises deploy their Qumu video software platforms in three ways: on-premise, hybrid and cloud. We had a higher percentage of on-premise deployments for both new and existing customers in the fourth quarter and in our pipeline for the first half of 2016. Despite this, we continue to build our software with a cloud-first approach, while packaging it for all types of deployment options.

• Our largest enterprise customer for the fourth quarter as I mentioned earlier were in the pharmaceuticals vertical - one in the United States and the other in Germany both where 7 figure transactions. On the other hand, our largest cloud deployment in the fourth quarter was a large retail chain with a $600,000 three year contract value.

• With that said, our main business case for cloud is departmental video communications in large and medium size enterprises, which focuses on user-generated content and/or external video distribution to integrate with marketing automation tools like Eloqua and Marketo as well as websites, social applications and other enterprise content management applications - like SharePoint and Jive.

• We are seeing a growing demand in our pipelines for hybrid deployments both in our base of customers and net new opportunities - this approach to enterprise video deployment will grow for us in 2016

• We continue to expand and upgrade our enterprise customers:

◦ In the quarter, we saw 4 large enterprises implement an upgrade to our latest release and expand their video platform footprint.

◦ We closed 13 enterprise deals greater than $200,000 in total contract value with both existing and new customers, and 3 transactions greater than $1 million in bookings for the quarter

• It was a very productive quarter from an operational and growth standpoint and we are positioned well for 2016.

In summary, we are in a strong position for growth in 2016. We continue to invest into the future with mindful discipline for our product direction, a clear vision for our team and operational momentum to carry us into the year well-positioned to reach our corporate milestone and revenue growth objectives.

Now, we would like to open the call to questions.

Q&A

Vern Hanzlik

Thank you again for joining us today. We look forward to updating you on our first quarter 2016 results in early May. In the meantime, if you have any follow-up questions please contact us directly.