Business News
Bitstream Inc. Reports Third Quarter Results for 2010
Tuesday 16. November 2010 - The Company reported that third quarter revenue increased 6% to $5,982,000, as compared to the third quarter of 2009, as well as 10% sequential revenue growth as compared to the second quarter of 2010.
Bitstream Inc. (Nasdaq: BITS) today reported that total revenue increased by $322,000 or 6% to $5,982,000 for the three months ended September 30, 2010 as compared to total revenue of $5,660,000 for the three months ended September 30, 2009 and by $547,000 or 10% sequentially as compared to $5,435,000 for the three months ended June 30, 2010. The Companys aggregate cash, cash equivalents, and investments at September 30, 2010 totaled $12,609,000, an increase of $476,000 from a balance of $12,133,000 at June 30, 2010 and a decrease of $5,420,000, as compared to a balance of $18,029,000 at December 31, 2009, reflecting the use of $6,528,000 of cash in the second quarter of 2010 to purchase certain assets of Press-sense Ltd.
“We are excited to see our revenues grow to $5,982,000 for the third quarter, our highest quarterly revenue since the second quarter of 2008,” said Anna Magliocco-Chagnon, President and Chief Executive Officer. “This growth was the result of increased sales for our e-commerce and Pageflex businesses as compared to the quarter ended June 30, 2010, a large order for our OEM font business and the addition of our first OEM revenue related to our new iWay product during the third quarter. We also made significant progress in building our relationships with our publishing OEM partners and look forward to growing this business as these partners relaunch the iWay product through their sales channels. We are also excited about the team we are building for our BOLT browser product line and the level of experience that they bring to us as we continue to focus on signing deals to monetize our BOLT offering.”
Our e-commerce sales increase for the three months ended September 30, 2010 contributed to an increase in direct third party cost of revenue, consisting primarily of royalty expenses, of $503,000 or approximately 30%, as compared to the three months ended September 30, 2009. Operating expenses increased $1,364,000 to $4,209,000 for the three months ended September 30, 2010 from $2,845,000 for the three months ended September 30, 2009. The increase was primarily due to increases in research and development (“R&D”) and general and administrative (“G&A”) expenses of $823,000 and $467,000, respectively. The increase in R&D expense consisted primarily of $571,000 due to the addition of R&D resources related to the iWay product line, as well as, an increase of $194,000 of increased publishing and browsing personnel related costs including salaries, benefits, and facilities. The increase of G&A expense was primarily the result of $109,000 in acquisition costs associated with the purchase of assets from Press-sense Ltd., $191,000 in director fees and expenses due to increases in the number of board members during 2010 (including $63,000 from the acceleration of stock award vesting for Mr. Ying upon his retirement), as well as a $203,000 increase in professional services including services from accounting, auditing, tax, legal and investor relations firm.
GAAP Results
Our loss from operations was $(1,091,000) for the three-months ended September 30, 2010, as compared to operating income for the three-months ended September 30, 2009 was $536,000. Our net loss for the three months ended September 30, 2010 was ($1,174,000) or ($.12) per share as compared to net income for the three months ended September 30, 2009 of $519,000 or $.05 per fully diluted share.
Non-GAAP Results
Our Non-GAAP results for the three months ended September 30, 2010 exclude stock-based compensation expense, the amortization of intangible assets primarily acquired from Press-sense Ltd. and acquisition costs for certain assets of Press-sense Ltd. Our Non-GAAP loss from operations was $(587,000) for the three months ended September 30, 2010, as compared to operating income for the three months ended September 30, 2009 of $759,000. Our Non-GAAP net loss was $(670,000) or $(0.07) per share for the three months ended September 30, 2010, as compared to net income for the three months ended September 30, 2009 of $742,000 or $0.07 per fully diluted share.