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Vonage Posts $72 Million Quarterly Loss

5/10/2007 07:57:00 AM Eastern

Holmdel, N.J. — VoIP provider Vonage announced a $72 million net loss in the first quarter, ended March 31, down from $85 million in the year-ago quarter.

The company’s first-quarter revenue hit $196 million, up 64 percent vs. the first quarter in 2006. Vonage added roughly 166,000 subscriber lines during the first quarter to finish with 2.4 million users.

Vonage also announced that it believed it had a work-around for two of the patents at issue in its legal dispute with Verizon.

"We believe we have workable designs for the two name translation patents and intend to begin deploying the solution to our customers shortly,” said Jeffrey Citron, Vonage chairman, in a statement. “In addition, we are continuing our development of the workaround for the wireless patent."

Vonage improved its monthly revenue per line in the first quarter by $0.46, while reducing the amount it spends on marketing per line by $33, from $306 in the first quarter of 2006 to $273 in 2007. Vonage indicated it would work to decrease customer acquisition costs and cut $110 million from its marketing budget when announcing management changes in April.

Subscriber churn was up slightly in the first quarter at 2.4 percent vs. 2.3 in the fourth quarter.

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