Towerstream widens loss in 2Q but improves customer retention

TOWERSTREAM CORP. reported a second-quarter 2014 net loss of $6.4 million, compared with a net loss of $6.2 million the year before, but the company also managed to lower its customer churn rate to 1.71 percent from 2.34 percent.
TOWERSTREAM CORP. reported a second-quarter 2014 net loss of $6.4 million, compared with a net loss of $6.2 million the year before, but the company also managed to lower its customer churn rate to 1.71 percent from 2.34 percent.

MIDDLETOWN – Telecommunications company Towerstream Corp. on Monday reported a second-quarter net loss of $6.4 million, or 10 cents per share, widening by 2.6 percent the net loss of $6.2 million, or 9 cents per share, recorded for the same period last year.

The year-over-year increase in the company’s quarterly net loss followed a net loss increase of 15.7 percent in the first quarter and an increase of 5.2 percent in the fourth quarter of 2013.

Despite the continued year-over-year retreat of Towerstream’s bottom line, the fixed-antenna 4G and Wi-Fi/small-cell network services provider saw an increase in revenue for the second quarter. Sales rose slightly to $8.3 million in the three months ended June 30, an increase of six-tenths of a percent compared with $8.2 million the year prior.

However, the revenue gain was less significant than sales increases recorded in the first quarter and the fourth quarter of last year, at 1 percent and 3.6 percent, respectively.

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Customer churn – which refers to the percent of revenue lost on a monthly basis from customers disconnecting from the Towerstream network or reducing their bandwidth – was 1.71 percent in the first quarter, compared with 2.33 percent during the first quarter and 2.34 percent in the second quarter of 2013.

“Our new 100-megabit offering continues to gain traction and customer additions, and we have targeted additional buildings for deployment over the balance of the year,” said Joseph Hernon, chief financial officer for Towerstream. “Our newly formed customer retention team has restored churn to our historical levels of approximately 1.7 percent, which has been our average for the past 36 months.”

Total average revenue per user increased to $760 during the second quarter from $740 for the same period last year, the company reported.

Towerstream’s Los Angeles market once again reported the highest sales for the second quarter, with revenue of $2 million, but that figure represented a decline of 2.5 percent compared with the $2.05 million reported in the second quarter of 2013.

Every market reported year-over-year revenue decreases, except the New York market, which rose half a percent to $1.95 million from $1.94 million a year earlier.

Towerstream also reported that its Providence-Newport market brought in revenue of $65,000 in the 2014 second quarter, a decline of 43 percent compared with the 2013 second-quarter revenue of $114,000.

The company’s Boston market revenue fell 11 percent to $1.45 million compared with last year’s revenue of $1.63 million.

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