Vonage 1Q profit shrinks 34 pct, shares slide
HOLMDEL, N.J.—Internet phone company Vonage Holdings Corp. said Wednesday that its first-quarter net income fell 34 percent as revenue slipped and expenses inched higher.
The company earned $13.9 million, or 6 cents per share, in the January-March quarter, down from $21.1 million, or 9 cents per share, a year earlier.
Excluding a one-time tax expense, earnings were $18.8 million, or 8 cents per share, in the latest quarter.
Revenue slid 2 percent to $215.9 million from $219.8 million. The company said that while its churn -- or subscriber turnover rate -- increased slightly in the first quarter, it has declined since peaking in January.
"We are confident churn will be lower in the second quarter," said CEO Marc Lefar in a statement. Churn was 2.8 percent in the latest quarter, up from 2.5 percent a year earlier.
The company reported a net loss of 19,000 lines during the quarter. That compares with 3,000 net line additions in the year-ago quarter.
Operating expenses rose 3 percent to $195.4 million from $190 million.
Shares fell 17 cents, or 8.3 percent, to $1.88 in afternoon trading. Earlier, the stock fell as low as $1.83, its weakest point since May 2010.
The Holmdel, N.J., company provides phone services over the Internet for customers in the United States, Canada and the U.K.