Napster Hitting Bottom? Rumors Circulate, Earnings Call Coming

Ahead of a Napster earnings call in early February, reports of a dire company situation have emerged.

According to sources inside the organization, a substantial round of layoffs is expected within weeks. In comments to Digital Music News, the sources noted that executives at the company are also reportedly considering various exit options, including a fire sale or liquidation. A Napster representative countered the claims, noting that there are “no imminent plans for significant layoffs,” while denying any intentions to liquidate or sell the company. Meanwhile, Apple has recently claimed a hefty 83 percent of the download market, a dominance that has created a squeeze for Napster and others.


The third quarter financial results, scheduled for February 8th, will be hosted by CEO Chris Gorog and CFO Nand Gangwani. Analysts and investors can dial-in to the conference, or listen to a live webcast from the Napster website. Napster’s strategic initiatives during the quarter included the launch of Napster Germany; a deal with XM Satellite Radio; and the expansion of the Napster Ringtones service to network provider Alltel. Napster shares presently stand at $3.27, down $6.57 from its 52-week high.