Vonage 3Q net income falls 68%
Vonage Holdings Corp. said Wednesday that its third-quarter net income tumbled 68 pct, as the company didn't attract as many customers to its higher-priced calling plans and lost some existing customers.
Vonage, which provides phone services through cloud-connected devices, added 175,000 new subscribers during the quarter, up from 172,000 a year ago. But price increases prompted some existing customers to drop the service. An industry measure of lost customers, "churn," ticked up to 2.6 percent from 2.5 percent.
The company said it added a net 11,000 lines, up from 9,000 in the third quarter of 2012, but much of the new business was related to its less profitable basic service plans.
Vonage earned $4.2 million, or 2 cents per share, down from $13.2 million, or 6 cents per share, in the same quarter of 2012. Excluding one-time items, profit came to 4 cents per share for the recent quarter.
Revenue fell 2 percent, to $204 million from $207.6 million.
Shares of Holmdel, N.J.-based Vonage fell 10 cents to $3.64 in morning trading.