Von
age Holdings announced results for the second quarter ended June 30, 2011. The Company reported record high net income of $22 million and record high adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) of $44 million.
Vonage generated record high adjusted EBITDA of $44 million, up from $41 million in the year ago quarter and $43 million sequentially. Income from operations increased to $31 million from $24 million in the year ago quarter and $30 million sequentially.
Net income increased to a record high $22 million or $0.10 per share, up from a net loss of $1 million or $0.00 per share in the year ago quarter, which included $12 million in charges relating to the Company's prior debt. This increase was driven by a $7 million increase in income from operations and a $7 million reduction in interest expense. Net income increased from $21 million or $0.10 per share sequentially.
Revenue was $218 million, down from $225 million in the year ago quarter due to a $3 million decline in deferred revenues related to discontinuation of activation fees and lower customer equipment and shipping revenue. Revenue declined from $220 million sequentially, primarily due to lower activation revenue and Universal Service Fund ("USF") fees. These factors contributed to a decline in average revenue per user ("ARPU") to $30.28, down from $31.21 in the prior year and $30.45 sequentially.
Telephony services ARPU was $30.14, down from $30.71 a year ago due primarily to impacts from lower deferred activation revenue. Telephony services ARPU decreased sequentially from $30.23 due to lower deferred activation revenue and USF fees.
New Products
Vonage announced two new products during the past week: Extensions and Time to Call.
Extensions, a free enhancement to the Company’s flat rate, unlimited international calling plan, addresses the needs of international long distance callers by extending the value provided by Vonage’s home service plans to additional phone numbers and devices including smartphones and feature phones.
Time to Call provides low-cost, easy to use international calling on smartphones around the world. According to the company, it is the first downloadable mobile application that allows pay-per-call international dialing to more than 190 countries. To promote its global launch, the Company is providing a free international call to everyone that downloads the application. This mobile application, designed for iPhones, allows consumers to make international calls of up to 15 minutes while avoiding high prices and roaming fees charged by traditional telecommunications carriers. The service is available in 87 countries around the world. Time to Call provides direct payment through iTunes.
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