Vonage Holdings Corp. (NYSE: VG), a leading provider of high-quality voice and messaging services over broadband networks, today announced results for the first quarter ended March 31, 2010.
Vonage generated net income of $14 million or $0.07 per share. This is an improvement from $5 million or $0.03 per share in the first quarter of 2009 and $4 million or $0.02 per share, sequentially.
Vonage reported record adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA")(1) of $40 million, up from $21 million in the year ago quarter and $34 million sequentially. This is the tenth consecutive quarter of record high adjusted EBITDA. Revenue of $228 million increased from $224 million year-over-year and sequentially. Income from operations increased to $25 million, up from $5 million in the year ago quarter and $19 million sequentially.
Marc Lefar, Vonage Chief Executive Officer, said "We continue to make significant progress improving the fundamentals of our core business while laying the foundation to deliver next generation services to our customers. We achieved best-in-class customer satisfaction levels and reduced churn to its lowest rate in nearly three years.
"Our financial performance was particularly strong, as we achieved record high net income and EBITDA. We more than doubled cash from operations sequentially and generated $47 million in free cash flow in the quarter. This strong cash generation enabled us to reduce our debt by prepaying $23 million in first lien obligations. This prepayment will reduce 2010 interest expense by $2.5 million and approximately $13 million over the life of the remaining debt.
"We continue to invest in new growth opportunities, including international and mobile, where innovation, customer service and cost-effective services are expected to drive future growth."
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