Retailers shift their ad spending from TV, radio and print ads to digital ads.
Online music and game sales dipped in the first quarter for RealNetworks by 18.9% and 7.9%, respectively. But software revenue grew at a healthy clip of 30.1%.
Online music and game sales dipped in the first quarter for RealNetworks Inc., but software revenue grew at a healthy clip.
For the first quarter ended March 31, RealNetworks, No. 99 in the Internet Retailer Top 500 Guide, recorded:
- Sales for Rhapsody.com declined year over year 18.9% to $35.7 million from $44.0 million in the first quarter of 2009.
- Total revenue dropped 8.7% to $128.6 million from $140.8 million in the first quarter of 2009.
- Digital music revenue accounted for 27.8% of total sales compared with 31.3% in the prior year.
- Technology products and service revenue decreased 3.9% to $41.9 million from $43.6 million in 2008.
- Games revenue declined year over year 7.9% to $30.2 million from $32.8 million.
- Sales for media software and services increased 30.1% to $29.8 million from $22.9 million in the first quarter of 2009.
- Net income was $3.2 million compared with a net loss of $12.1 million in the prior year.
“We made significant progress toward achieving our milestones to transform RealNetworks over the coming year into a growing and profitable company,” says acting CEO Bob Kimball. “While we are moving fast to transform the company, our plans to simplify, restructure and grow RealNetworks require substantial work, and it will take some time before we see the financial benefit of our efforts.”
After the first quarter, RealNetworks will no longer be including Rhapsody in its financial results, the company says. In February, RealNetworks announced that Rhapsody America LLC will become an independent company after being spun off by majority owner RealNetworks and MTV Networks. MTV parent Viacom International Inc. now owns 52.5% of the online music service and RealNetworks owns 47.5%.