MusicNet sale aids in RealNetworks' profits increase
Online media company RealNetworks saw fast growth in its music and games offerings last quarter, driving its swing into profit.Company reported net income of $4.7 million, though that included a $7.6 million gain from the sale of its share in online musicstore MusicNet and litigation costs of $4.7 million in its anti-trust lawsuit against Microsoft. Excluding both figures, company made $1.7 million, still up markedly from a $4.6 million loss in the same quarter last year. Revenue was $82.7 million, or $75.1 million excluding the MusicNet sale, up 15%. Driven primarily by its subscription music service, Rhapsody, company saw music revenue rise 61% to $24.1 million. Online game subscriptions also grew significantly, with revenue up 63% to $13.6 million. Growth in the online advertising biz helped boost its media revenue 22% to $8.2 million, while the company’s business-to-business division was up only slightly at $12.1 million. RealNetworks now has more than 1.15 million subscribers to its music products, primarily Rhapsody, and more than 2 million subs overall for all its digital media offerings. After closing up just 1% at $5.05 before earnings were announced, Real stock was up 12% in after-hours trading.