Napster Slims Losses Considerably, Subscribers Slip

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Napster slimmed losses considerably during the recent quarter, though subscriber uptake appeared problematic.

The subscription and download offering posted losses of $4.2 million ($0.10 per basic and diluted share) for the fiscal first quarter ending June 30th, slimmer than a year-ago drop of $8.5 million ($0.20 per basic and diluted share).  Meanwhile, revenues reached a record $32.3 million, up 15 percent over figures of $28.1 million during the same period last year.

Napster credited aggressive cost-cutting and leaner marketing for the narrowed losses.  “Napster has substantially lowered its subscriber acquisition costs, and the benefits are clear in our results,” commented company chairman Chris Gorog.  But subscriber totals dipped 2.5 percent from the last quarter, a move that counts seasonal exits in university accounts.  Current subscriber levels now hover around 770,000, up from 508,000 during the same quarter last year.  Meanwhile, cash reserves notched upward slightly from last quarter to $67.1 million, though the figure represents a significant decrease from year-ago tallies of $97.8 million.