AT&T Leaves Yahoo! For Synacor

The Synacor deal shifts a significant portion of AT&T’s business away from Yahoo!, as AT&T ends its 15-year revenue-sharing partnership with the company.

AT&T is cancelling the contract with Yahoo at a time when rival Verizon is actively pursuing the digital media company for acquisition.

For Synacor, the AT&T agreement value is a really big one.

Himesh Bhise, Synacore CEO, told analysts during a call that the deal will bring in about $100 million annually after it fully deploys and the company migrates customers, targeted for 2017.

In partnership with AT&T, Synacor will develop and manage innovative desktop and mobile portal services created to drive user engagement, populate these experiences with rich content sourced from popular brands and monetize these experiences through search and advertising. (T) has awarded a contract to host its web and mobile portals to Synacor Inc. Shares in Synacor soared following the news that the company had ripped a multimillion-dollar AT&T contract from Yahoo.

Synacor shares had surged 127.9% at $3.21 in recent trade after announcing Wednesday that AT&T selected the company to provide portal services that drive user engagement. AT&T’s decision deals another blow to an already shrinking Yahoo Ad and Search business. Yahoo search also appears in other AT&T products.

Yahoo isn’t commenting on the breakup outside of calling AT&T a “valued partner”. Both the companies will split revenue from search and advertising. That’s more bad news for Yahoo, which is up for sale.

Synacor, Inc. has a 50 day moving average of 1.45 and a 200 day moving average of 1.59.

Shares of Synacor Inc (NASDAQ:SYNC) are flying sky-high today, trading as much as 150 percent above Wednesdays closing price of $1.41.