Music portal ArtistDirect posted a $11.2 million net loss in its first quarter as a public company, the Los Angeles-based company reported Tuesday.
The net loss for the company during the first quarter of 1999 was $2.7 million. Net revenues for the quarter ended March 31 were $4.5 million, up 165% from the previous year. Forty percent of that revenue came from advertising, up 22% from the first quarter of 1999.
ArtistDirect is an online network that provides music news, digital music downloads and fan clubs and acts as an e-commerce outlet for bands like the Backstreet Boys and Limp Bizkit. The company also operates the ArtistDirect Agency and Kneeling Elephant Records.
“Our strong first-quarter results demonstrate the soundness of our business model, combining great revenue growth with well-managed operating expenses,” CEO Marc Geiger said.
In conjunction with the quarterly earnings report, ArtistDirect clarified the amount of loss it will take as a remedy because of the issuance of options and shares in violation of securities laws that occurred at the time of the company’s initial public offering on March 28. The stock buyback will cost about $8 million, plus interest. On Tuesday, ArtistDirect closed up three cents at $4.53.