NEW YORK—Voice-over-IP phone pioneer Vonage today announced a third-quarter loss of $54.6 million, or 33 cents a share, a much larger loss than at the same time in 2008, when it lost $7.8 million.
Vonage Holdings Inc. said that much of the loss came from a $63 million charge that resulted from a rise in Vonage's stock price earlier in the quarter, a financial accounting oddity due to how its convertible bonds were structured.
The company had aggressively rolled out Vonage World to much fanfare and promotion, touting its flat-rate unlimited worldwide calling plans to 60 countries, including the United States, Canada, Mexico, and India, for $25 a month.
Vonage said that 400,000 people had signed up for its Vonage World service, but that it has also lost 50,000 subscribers during the same period. Vonage said its "churn rate," referring to customers who join and leave the service, increased to 3.4 percent from 3.2 percent. The company cited "macroeconomic environment" conditions for this increase in turnover.
The company's revenue remained almost steady, dipping 2 percent to $221.5 million from $225.8 million. But it said that its average revenue per customer line increased from $28.75 to $29.89, a jump of 4 percent.
Vonage Holdings is one of the pioneers in Voice-over-IP phone solutions, but has found its market share and revenue eroded in the last few years by software VoIP solutions such as Skype, which have their own commercial offerings, as well as competing products from telecommunication vendors and service providers such as Verizon.