(Associated Press via NewsEdge) In its first earnings report as a public company, Internet phone carrier Vonage said its losses increased 17% in the second quarter as customer-acquisition costs stayed high.
The results illustrated the challenges facing Vonage, which raised nearly $500 million with a May 24 initial public offering that was disastrous for investors. The stock debuted at $17 per share and dropped immediately, recently lingering below $7.
Vonage's loss from April through June was $74.1 million, or $1.16 per share, compared with a loss of $63.6 million in the same quarter last year.
The consensus forecast of analysts surveyed by Thomson Financial was for a loss of 56 cents per share this time, but the predictions fell in a very wide range, from a loss of 38 cents to a loss of $1.18.
Revenue was $143.4 million, short of Wall Street's forecast of $148.3 million. Vonage's revenue was $59.4 million in the same quarter a year ago.
A pioneer in selling inexpensive phone service using VoIP, Vonage has attracted 1.9 million subscribers who use their broadband connections to make calls with regular phones.
But Vonage has spent heavily on marketing and is under competitive assault from cable TV companies that are using VoIP to offer attractive phone plans. Meanwhile, computer-based services such as eBay's Skype program offer free voice chats.
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