News on REVS:
(BSNS WIRE) Talk City Reports 422% Revenue Growth for Second Quarter
Talk City Reports 422% Revenue Growth for Second Quarter
Business Editors
CAMPBELL, Calif.--(BUSINESS WIRE)--Aug. 4, 1999--Talk City, Inc.
(NASDAQ:TCTY), a provider of online communities and interactive
services to businesses and consumers, today announced financial
results for the second quarter ended June 30, 1999.
Talk City reported revenue of $1.4 million for its second quarter
compared to $268,000 in the year ago period, a 422% increase. Sales
of the Company's core business services offerings, including online
market research and custom-hosted online community services, increased
522% to $410,000 for the quarter, up from $66,000 in the year ago
period. Advertising and sponsorship sales increased 390% to $990,000
in the quarter from $202,000 in the second quarter of 1998.
The Company reported a net loss of $7.1 million or $0.40 per
share (pro forma, after giving effect to the conversion of its
preferred stock to common stock) for the quarter, excluding non-cash
advertising and associated accounting charges, compared to $2.3
million or $0.31 per share for the year ago period. Including non-cash
charges, net losses totaled $15.0 million or $0.84 per share pro forma
for the quarter compared to $2.4 million or $0.33 per share, for the
year ago period.
"The momentum and sales breakthroughs we're experiencing in our
business services offerings are especially gratifying in a quarter
that saw substantive progress for all of our multiple revenue
streams," said Peter Friedman, Talk City's CEO and President. "Our
growing range of interactive services for businesses -- from online
focus groups and market research to online events and custom community
programming -- are clearly bringing value to those top brands that
want to improve relationships with their customers and employees
online. Starbucks, Novell, Mattel, Motorola, and Sears are just a few
of the companies that have selected Talk City, illustrating how our
portfolio of interactive services can advance Digital Age customer and
employee relations.
"Our online advertising and sponsorships business exceeded our
estimates during the quarter as a result of higher CPMs, improved
sell-through, and more targeted advertising inventory for our consumer
community site offering, www.talkcity.com. We believe this validates
our strategy of cultivating a respectful, moderated online community,
as it promotes the kind of online environment, audience, and
sponsorship opportunities that consumer brands seek," continued
Friedman.
During the quarter, Talk City continued to outpace other online
community sites in key metrics associated with customer retention, or
"stickiness," as Talk City topped -- for the third quarter in a row --
community sites Geocities and theglobe.com in Media Metrix' ranking of
minutes/usage day and minutes/month for at home usage.
"Perhaps most notable in the quarter was the Intel and
Blockbuster sponsorship of our popular, exclusive chat programming for
Lucasfilm's blockbuster Star Wars: Episode 1; Phantom Menace," said
Friedman.
Top brands also continue to choose Talk City as their community
services provider by becoming partners and participants in the Talk
City Network. More than 40 concerns -- including media companies,
Internet content providers, and portals -- have chosen Talk City to
provide online community for their sites. In the second quarter, Talk
City was chosen by Microsoft Corporation to be the tools provider for
Microsoft Network's home page offering. Microsoft was joined by
Lifetime TV, CNBC, and CosmoGIRL! Magazine, among others, as new
participants in the Talk City Network during the last quarter.
"Going forward, we look to intensify our focus on our business
services offerings as we continue to cultivate a consumer advertising
environment that is attractive to mainstream consumer brands. We
believe our unique role in the industry -- as the most comprehensive
provider of community and interactive services for business and
consumers -- positions us to maximize the opportunity presented by the
strong and enduring growth of the online community category," said the
CEO and President.
Talk City is a provider of online communities and interactive
services for businesses and consumers. Talk City offers businesses a
wide range of services that help them develop and expand online
relationships with customers, suppliers and employees. These services
include designing fully integrated, customized communities, producing
online events, conducting online market research, and facilitating
online meetings. For consumers, Talk City operates a network of online
communities located at wwwtalkcity.com. The network includes 20
topical categories, over 50 themed communities, 50 co-branded network
participant communities, and thousands of user-generated communities.
Some Talk City network participants include Cox Interactive Media, The
Hearst Corporation, the National Broadcasting Company, Inc. Web TV
Network, Excite@home and AT&T WorldNet.
Statements herein contain forward-looking information concerning
the Company's future prospects and other forecasts and statements of
expectations. Actual results may differ materially from those
expressed in the forward looking statements made by the Company as a
result of, among other things, the Company's ability to increase the
number of business services clients, expand its business services
offerings and effectively implement these services, increase
advertising and sponsorship revenues, improve or maintain audience or
traffic measurement metrics, maintain differentiation from other
online community providers, maintain or improve the number or quality
of network partners and customers, as well as other risk factors
described in the Company's prospectus filed with the SEC and dated
July 19, 1999.
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TALK CITY, INC.
AS OF JUNE 30, 1999
SUMMARY FINANCIAL INFORMATION
(in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
1999 1998 1999 1998
Statement of operations data:
Business services $ 410 $ 66 $ 410 $ 126
Advertising and sponsorships 990 202 1,613 267
----- ----- ----- -----
Total revenues 1,400 268 2,023 393
Operating expenses 8,779 2,333 15,402 4,320
Noncash advertising
and promotional changes 7,921 118 9,331 1,157
------ ------ ------ ------
Loss from operations (15,300) (2,183) (22,710) (5,084)
Interest income (expense), net 300 (251) 454 (241)
------ ------ ------ ------
Net loss (15,000) (2,434) (21,899) (5,325)
Accretion of redeemable
convertible preferred
stock and warrants 71 20 143 40
------- ------ ------ ------
Net loss applicable
to common shareholders $ (15,071)$ (2,454) $ (22,042)$ (5,365)
Net loss per share:
Basic and diluted $ (4.00) $ (0.72) $ (5.93) $ (1.59)
Weighted average shares 3,766 3,417 3,714 3,375
Pro forma net loss per share (1)
Basic and diluted $ (0.84) $ (0.33) $ (1.52) $ (0.73)
Weighted average shares 17,904 7,376 14,443 7,252
Note:(1) Giving effect to the conversion of preferred stock to common
stock prior to the Company's Initial Public Offering effective July
19, 1999.
Balance sheet data: June 30, December 31,
1999 1998
Cash, cash equivalents
and short-term investments $ 21,238 $ 14,437
Working capital 19,907 13,493
Total assets 32,804 18,490
Long term obligations,
net of current position 188 273
Redeemable convertible
preferred stock & warrants 71,366 38,973
Total stockholders deficit $ (43,244) $ (22,463)
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--30--cs/sf* ac
CONTACT: TALK CITY, INC.
Peter Friedman, CEO & President, 408/871-5212
or Jeffrey Snetiker, CFO, 408/871-5212
or
Morgen-Walke Associates, Inc.
Investor Relations:
John Swenson/Erica Mannion, 415/296-7383
Media Relations: Alisha Nieva Woodgate, 415/296-7383
Wire Services: Eric Gonzales, 212/850-5600
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: INTERACTIVE/MULTIMEDIA/INTERNET COMED EARNINGS
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