James Delahunty
17 May 2007 9:19
Napster has closed its fourth quarter with subscribers to its music rental service being at an all time high but with a widened loss during the quarter due to the impact of a one-time gain in the same quarter of the previous year. The company reported that its net loss was $8.5 million, about 20 cents per share in the period that ended March 31, compared to $4.4 million, or 10 cents per share in the same period a year before.
Revenue rose 9 percent to $29.1 million, compared with $26.8 million in the same quarter last year. The company's shares fell 15 cents, or 3.7 percent, in extended trading after they rose 9 cents to $4.07 in regular trading Wednesday. Napster Chairman and Chief Executive Chris Gorog said that the company was in its strongest position since launching.
"As we head into fiscal 2008, we are acquiring customers cheaper and keeping them longer. We are growing revenues while reducing expenses. We are attracting more world-class partners than we ever have before," Gorog said. Napster closed the quarter of a subscriber base of 830,000 which includes 225,000 former AOL Music Now users and University users.
The number of paid Napster subscribers rose 37 percent from the same quarter of the previous year. For the fiscal year, the company reported a net loss of $36.8 million, or 85 cents per share, compared with a loss of $54.9 million, or $1.28 per share, during the previous year while total net revenue increased 17 percent to $111.1 million from $94.7 million in fiscal 2006.
Napster has struck several important deals recently with AT&T Inc., Circuit City Stores Inc. and Motorola Inc. The deals will help the company cut back on marketing dollars and help drive new subscribers to its service. Napster is also banking on adding more subscribers as the number of music-enabled mobile phones grows.
Source:
Yahoo