NEW YORK (Reuters) – Internet phone company Vonage Holdings Corp posted a narrower-than-expected fourth-quarter loss on Wednesday as it added new subscribers.
Vonage also said it would restate results from its second and thirdquarters in 2007, to correct the amount of non-cash stock compensationexpenses it recorded.
This was the latest blemish for Vonage, which pioneered offering alow-cost, Web-based alternative to traditional phone services but stillfaces growing competition from cable and Internet companies which offerbundles of services that include voice, Internet, and video.
Vonage shares rose slightly to $2.05 in early trade on the New YorkStock Exchange. While they have edged higher in the past month, theyare still down more than 65 percent from one year.
The fourth-quarter net loss was $11.1 million, or 7 cents per share,from a loss of $117 million, or 76 cents a share a year earlier.
Excluding special items, its loss was 6 cents a share. Analysts hadexpected a loss of 10 cents a share, according to Reuters Estimates.
Total revenue for the quarter rose 19 percent to $215.9 million.
Subscriber additions in the quarter were 56,000, down from 78,000 inthe third quarter, and 166,000 in the fourth quarter last year. Vonageended the quarter with 2.6 million lines.
Churn, a measure of cancellations, remained flat sequentially at 3 percent.
The Holmdel, New Jersey, company added that costs of acquiring newcustomers fell, shrinking to $223 from $306 in the year-ago quarter.Vonage expects full year acquisition costs to stay in a range of $225to $250.
Vonage added that currently it is in talks regarding a refinancing of its debt, which it believes it will be able to resolve.
Despite those challenges, Vonage Chairman and interim ChiefExecutive Jeffrey Citron said the company will continue to expand thecompany this year.
"Looking to 2008, we are confident in our ability to grow thebusiness profitably and provide customers innovative, feature-rich andcost-effective communications services."
(Reporting by Franklin Paul and Susan Zeidler in Los Angeles; Editing by Derek Caney)
Copyright Reuters 2008. All rights reserved. Users may download and print extracts ofcontent from this website for their own personal and non-commercial use only.Republication or redistribution of Reuters content, including by framing orsimilar means, is expressly prohibited without the prior written consent ofReuters. Reuters and the Reuters sphere logo are registered trademarks ortrademarks of the Reuters group of companies around the world.
