Loudeye Achieves Record First Half Operating Metrics and Expects Improved Second Quarter 2003 Financial Results
Anticipates its Best Quarterly Performance in Net Loss and Net Loss Per Share as a Public Company
Seattle — July 7, 2003 — Loudeye Corp. LOUD, a leading provider of services for the management, promotion and distribution of digital media, today announced record first half operating metrics serving more than 370 million digital music samples and 6.5 million encoded files to its customers. Additionally, the Company announced it expects second quarter 2003 financial results to include improved net loss and net loss per share results.
Operating metric highlights include:
- During the first half of this year, Loudeye has seen an increase in streaming music sample usage year-over-year, with more than 370 million music samples served by Loudeye through its customers' Websites, including Amazon, Yahoo!, MSN and WindowsMedia.com, Barnes & Noble and America Online. This period is generally seasonally slower for online music sales and music samples usage, compared to the end-of-year holiday season.
- Loudeye delivered 6.5 million encoded files to customers in the first
half of 2003, which represents 55% more files delivered than all of
2002 combined. This performance was enabled by Loudeye's highly
scalable and proprietary music archive and distribution systems.
- Loudeye's digital music archive, the world's largest legitimate
archive of uncompressed digital master music files, has reached nearly
4 million full songs representing a "one-stop" repository for digital
content from all five major music companies and several hundred
independent labels. In addition, the company provides a hosted
samples library of more than 13 million music samples (including
multiple formats and bit rates) for distribution through major online
retail and portal websites.
As a result of this record operating performance in combination with a focused strategic plan, for the second quarter 2003 Loudeye anticipates that it will report its best quarterly financial performance as a public company in terms of net loss and net loss per share. This anticipated performance primarily reflects improvement in gross margins and reductions in operating expenses and special charges. In addition, the company expects to report that its total cash, short-term and restricted investments at the end of the second quarter 2003 increased from the end of the first quarter 2003, due primarily to its focused cost savings initiatives, improvements in gross margins, working capital financing and cash management programs. Loudeye expects to provide additional information about its second quarter results next week before its annual shareholder's meeting scheduled for July 16, 2003.
The financial and operating results reflect the increasing demand for outsourced digital media services and the growing use of digital media among online retailers, music subscription and download services, record labels, portals, wireless carriers and other companies building a business or brand around digital music or film.
"We are focused intently on execution and are pleased to see the results in our operating metrics and improved financial performance in the second quarter," said Jeff Cavins, Loudeye's president and chief executive officer. "Several factors are driving this growth including the expansion of the digital music channel and the increased activity by our customers in digital media deployments. When customers outsource to Loudeye's highly scalable 'private-label' platform, we can help drive faster deployments at a lower cost, resulting in increased online sales, lower customer acquisition costs and higher return on investment."
About Loudeye Corp.
Loudeye provides the business infrastructure and services for managing, promoting and distributing digital content for the entertainment and corporate markets. For more information, visit www.loudeye.com.
Forward Looking Statements
This release contains forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the growth of Loudeye's business including operating metrics for 2003; statements related to preliminary anticipated second quarter 2003 financial results, including estimated net loss, net loss per share, and anticipated total cash, short-term and restricted investments; statements regarding growth and usage trends for digital media and demand for outsourced services; and the statements made by Loudeye's president and CEO in this release. The company believes the preliminary financial information related to the second quarter of 2003 to be materially accurate although that information is subject to adjustment based upon final internal reviews and review procedures to be performed by Loudeye's independent accountants. These statements are based on Loudeye's opinion of current trends and actual results may differ materially due to risks, including adverse changes or a slow down in the adoption of digital media and outsourced services in the markets Loudeye serves; the loss of any key customers; the failure to continue to maintain or develop new copyright licenses to deliver current and future services; the failure or loss of service of Loudeye's technological infrastructure; the complexity of Loudeye's services and delivery networks; and other risks set forth in Loudeye's most recent Form 10-Q, Form 10-K and other SEC filings which are available through EDGAR at www.sec.gov. Loudeye assumes no obligation to update the forward-looking statements. .
Contacts
Media/Public Relations: Andrew Cullen, Barokas Public Relations, 206.264.8220, andrew@barokas.com
Investor relations: Michael Dougherty, 206.832.4000, ir@loudeye.com
