CyberSource Announces Third Quarter 2003 Financial Results

Thursday 16 October 2003 09:13 CET | News

CyberSource has reported financial results for its third quarter ended September 30, 2003. Total revenue was $6.9 million, $0.2 million higher than guidance.

Transaction and support services revenue was $5.3 million for the quarter, consistent with the Companys earlier guidance. Enterprise software revenue was $1.1 million, slightly higher than the Companys guidance of $1.0 million, while professional services revenue was $0.5 million, also slightly higher than the Companys guidance of $0.4 million. The Company processed a record 72.2 million transactions during the quarter, exceeding the 52.2 million processed in the same quarter of the prior year by 38%. Gross margin was also a record 67%, exceeding guidance of 64%. Gross margin for the same period of the prior year was 59%. Operating expenses for the third quarter of 2003 were $6.1 million compared to guidance of $6.2 million. Operating expenses include a $0.2 million restructuring charge due to a minor reduction in headcount in July. In addition, General and Administrative expense includes the reversal of a legal accrual of approximately $0.3 million. Overall, the Company recorded a net loss of $1.4 million for the third quarter of 2003 compared to the Companys previous guidance of a $1.9 million net loss. The net loss per share of $0.04 was also lower than guidance of a $0.06 net loss per share. This compares to a net loss of $2.0 million or $0.06 per share for the same period last year. Business developments during the third quarter Bank card volume. During the third quarter, CyberSource processed over $3.6 billion in transactions, an increase from $2.9 billion in the prior period. Alliance with PayPal. CyberSource recently announced an alliance to offer PayPal as a payment option to its customers. Merchants are seeking to support new and emerging payment types to reach more customers via the Internet. This agreement provides a simple connection between CyberSources over 3,000 customers and PayPals 31 million subscribers. This is part of CyberSources larger strategy to provide a single source solution for online merchant payment. CyberSource is the first payment solutions provider to offer PayPal to its customers. Alliance with First Data. In August, CyberSource announced a strategic relationship with First Data to deliver enhanced payment options for CyberSource merchants. A key component of that partnership is the Telecheck Internet Check Acceptance service from First Data which is now available to CyberSource merchants. CyberSource Reconciliation Solution. Also in August, CyberSource announced its answer to a problem that continues to plague online merchants -- the manual processing required to reconcile orders with receipts and to manage chargebacks and rejected payment requests. This customized offering is designed to eliminate up to 90% of the manual reconciliation processes online merchants typically experience. Recurring Billing Service. On October 14, 2003, the Company announced a new recurring billing service that enables merchants to easily offer subscription billing to their customers. Subscription models can yield a higher lifetime value per customer, lower cost of sales, lower payment risk, more predictable revenue streams, and lower banking costs. The CyberSource solution includes unique payment technology (called Total Collect) that automatically fixes common subscription payment failures due to card expiration dates and temporary authorization issues. Success in key verticals. The Company has experienced sales success in a number of vertical markets, including education, government and retail. CyberSource has over 60 educational institutions as customers, including Georgetown, Harvard University, UC Berkeley, UCLA, UC Santa Barbara, and Washington State University. The Company has over 40 government agencies among its customers and thousands of retail operations including newly-signed Barneys New York, Beach Camera, and Linksys. Other new customers signed this quarter. CyberSource added over 400 ne

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Categories: Payments & Commerce | Payments General
Countries: World
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Payments & Commerce