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Napster posts bigger 3Q deficit as increased ad spending countered higher revenueThe Associated Press Napster Inc. on Wednesday said it fell to a loss in its fiscal third quarter as the company increased spending on marketing its online music service. The company posted a deficit of $17 million, or 40 cents per share for the three months ended Dec. 31, compared with income of $12.8 million, or 36 cents, the year before. Analysts surveyed by Thomson Financial were looking for a loss of 61 cents per share. Revenue for the period totaled $23.5 million, nearly twice the $12.1 million from a year earlier and in line with analysts' consensus target. Napster said it added 66,000 subscribers during the quarter. Although its music revenue rose sharply, Napster also increased its sales and marketing expenses 68 percent, to $15.4 million from $9.2 million a year ago. The company said it expects revenue of $25 million in the fiscal fourth quarter, but said it expects expenses to decrease. Analysts were predicting revenue of $26.1 million. Napster shares rose 14 cents, or 3.9 percent, in after-hours electronic trading. The stock added 3 cents to close at $3.61 in the regular session on the Nasdaq, before the earnings report was released. |