An Atlanta-based company that delivers VoIP, high-speed Internet and Web-based applications to small businesses this week reported a net income of about $500,000 for the three-month period that ended Dec. 31 – a drop of $12 million from the year-ago quarter.
Officials at Cbeyond say the company, which uses networking gear from Cisco Systems Inc., also posted revenues of $93.9 million for the quarter, up 22 percent from 2007.
According to Jim Geiger, the company’s chief executive officer, Cbeyond (News - Alert) is producing strong results despite the deepening recession.
“Gross additions were at the highest level in company history during the fourth quarter, customer churn has remained generally stable, average revenue per customer is up year over year, applications used per customer increased to 7.0 from 6.3 in the corresponding quarter of 2007, and we now serve a third of our customers with mobile services, after introducing the product just three years ago,” Geiger said.
Here’s a snapshot of the company’s financial report for the quarter and all of 2008:
Analysts would agree with Geiger’s assessment of the mobile industry.
As TMCnet reported this week, mobility is due to emerge relatively well from this economic recession, according to a new study from a Framingham, Massachusetts-based subsidiary of the International Data Group.
Officials at IDC say that the $700 billion mobile industry – which now serves almost half of the world’s population, with 3.6 billion subscriptions at the end of 2008 – has its fingers in both developed and emerging markets.
According to the firm’s director of mobility research, Shiv Bakhshi, different industry segments likely will enjoy different growth trajectories, and some will enjoy it more than others.
From 3.32 billon at the end of 2008, the firm expects the number of mobile voice connections to reach 4.57 billion by the end of 2012, an average compound growth rate of 8.3 percent per year. The most prolific source of new mobile connections will be India, China, and the other large markets in which mobile penetration is currently below 50 percent of the population.
Geiger said that Cbeyond’s record of financial achievements is impressive, given the environment.
“For the full year of 2008, we posted 25 percent growth in revenue and 16 percent growth in adjusted EBITDA, while maintaining a strong balance sheet, evidenced by our cash balance of $37 million and no debt at year end,” Geiger said. “Even in this difficult economy, we believe our results show that Cbeyond offers small businesses a valuable and compelling package of applications and that our differentiated business model is successful, proven, and resilient.”
The company is also reporting total customers in its eleven operating markets of 42,463, reflecting net customer additions of 1,894 in the quarter, and average monthly revenues per customer location of $754 during the fourth quarter of 2008, compared to $760 in the third quarter of 2008 and $750 in the fourth quarter of 2007. Finally, the company saw monthly customer churn of 1.4 percent in the fourth quarter of 2008 as compared to 1.3 percent in the third quarter of 2008.
In reporting the company’s finances, Geiger also said that Cbeyond is planning its thirteenth market launch will be Seattle.
“This is a market that shares many of the characteristics of Denver, one of our most successful markets,” Geiger said. “Both are comparable in size, very tech-savvy and served by the same incumbent service provider. We look forward to our first customer installation occurring in the second half of the year.”
For 2009, the company is calling for $420 million to $440 million in revenues.
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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.
Edited by Michael Dinan