RealNetworks (RNWK) today announced that for the third quarter of 2007, revenue grew 55% to $145.1 million compared to $93.7 million for the third quarter of 2006. Technology Products and Solutions revenue of $53.3 million, a 377% increase over the third quarter of 2006, due in large part to the acquisition of WiderThan during the fourth quarter of 2006. So, much of the improvement was not “organic” as Wall St. types like to say.
Net income for the third quarter of 2007 was $4.3 million or $0.03 per diluted share, compared to $42.2 million or $0.24 per diluted share in the third quarter of 2006. Results for the third quarter of 2006 included payments related to Real’s antitrust settlement and commercial agreements with Microsoft.
Gross margin was 61% in the third quarter of 2007 compared to 70% in the third quarter of 2006.
For the fourth quarter of 2007, Real expects revenue in the range of $152 million to $157 million, GAAP net income per diluted share of $0.00 to $0.01 and adjusted net income per diluted share of $0.06 to $0.07. For the full year 2007, Real expects revenue in the range of $563 million to $568 million. Real expects 2007 GAAP net income per diluted share of $0.28 to $0.29 and adjusted net income per diluted share of $0.23 to $0.24.
Analysts had looked for EPS of ($.01) on revenue of $143 million. And for Q4 guidance of $.02 on $168 million in revenue.
In the eyes of Wall St. the figures were close enough for government work. The shares were up a fraction to $6.60 after hours.
Douglas A. McIntyre
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