(Associated Press via NewsEdge) Internet phone company Vonage narrowed its fourth-quarter loss to $65 million as revenue nearly doubled with the addition of nearly 1 million customers during 2006.
The loss of $0.42 per share for the final three months of 2006 was in line with estimates of Wall Street analysts surveyed by Thomson Financial.
In the fourth quarter of 2005, Vonage posted a loss of $72 million, or $51.55 per share, because the company had not yet sold its shares to the public.
Fourth-quarter revenue rose 91% to $181 million, from $95 million in the year-ago period.
Investors frowned at the report, sending Vonage's shares to an all-time low.
Vonage said its customer base grew by 166,000 subscribers in the quarter to end 2006 with 2,224,000 subscribers.
Monthly phone revenue per customer, a key indicator given the industry price wars, averaged $27.41. That was up $1.41 from a year ago, but the gain was driven by new fees Vonage began collecting in October to recover the cost of providing 911 emergency service and required Universal Service Fund contributions to subsidize phone service in rural and low-income areas.
In the fourth quarter of 2006, the cost of providing phone service increased to $52 million, up from $30 million a year earlier. But on a per line basis, those costs fell to $8.13, including the new USF fees of $1.24, down from $8.50 a year earlier.
Marketing costs grew to $96 million in the fourth quarter, from $67 million in the year-ago period. Broken down by new subscribers signed up during the quarter, customer acquisition costs averaged $306 per new line.
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