Salon.com (Nasdaq:SALN), one of the Internets leading media companies, producing a network of 11 original content sites and two online communities, reported record sales and a significant increase in unique users during the third quarter of fiscal 2000, ended December 31, 1999. Revenues for the quarter were $3.0 million, up 119 percent sequentially from $1.4 million in the previous quarter, ended September 30, 1999 and up 193 percent from $1.0 million in the same quarter a year ago. Reflecting strong holiday demand from marketing partners and ecommerce retailers during the recently completed quarter, Salon.com secured over 150 advertising partners and sponsors, including 25 specific "Etailers" in its Holiday Buying Guide.
"This was a breakthrough quarter for Salon.com in increasing our revenue 119 percent from the September quarter to over $3 million and growing our user base to over 3.4 million unique visitors per month." Said Michael ODonnell, Salon.coms CEO and President. "Were now beginning to monetize the business by leveraging the quality of our content operation with the demographics of our valuable and sizable audience."
During the December 1999 quarter, Salon.com also reported that over 150 advertisers, ecommerce retailers and sponsors had utilized the Salon.com network of 11 web sites to communicate their products and marketing messages. Salon.coms advertiser base now exceeds 325, including major brands such as Lexus, IBM, Microsoft, EDS along with new economy companies RedEnvelope, Gavelnet and Vote.com.
"We believe that our strongest sales numbers to date demonstrate Salon.coms unique ability as a leading Internet media company to attract users, and then sell to those users," said ODonnell. "The revenue results reflect the relationships that our experienced national sales staff have developed over the past three years with some of the worlds leading brands."
Salon.com recently announced that it will add potential new revenue streams and create sponsorship packages in 2000 with the introduction of its new site, Politics2000.com; extensive coverage of the 2000 Summer Olympics in Sydney, Australia; cross-selling television inventory on the Salon.com television show, scheduled to air in Fall 2000 on the Bravo Network; and packaging online and new television inventory on the public television series "Burt Wolf: Travels and Traditions."
"We are capitalizing on the rapid convergence of traditional and Internet media by cross-selling our brand and offering fully integrated, multi-level sponsorship programs," added ODonnell. "In 2000, we intend to enable our advertisers and marketing partners to develop a comprehensive advertising campaign and place multilevel creative executions online, with Internet radio, broadband streaming and television."
Reflecting the companys continued investment in the expansion of its sales organization, national advertising and branding programs, and unique proprietary content, the pro forma net loss (excluding non-cash charges) for the third quarter was $5.6 million, or $0.49 per share, in comparison to the pro forma net loss of $1.2 million, or $0.28 per share, for the same period a year earlier. Net loss attributable to common stockholders for the third quarter was $6.4 million, or $0.57 per share.
Revenue for the first nine months of fiscal 2000 was $5.4 million, up 162 percent from $2.1 million for the same period a year earlier. Pro forma net loss for the first nine months of fiscal 2000 was $13.1 million, or $1.25 per share, compared to $3.9 million, or $0.96 per share, for the same period a year earlier. Net loss attributable to common stockholders for the first nine months of fiscal 2000 was $27.2 million, or $3.30 per share.
"Salon.com is demonstrating the value of distributing its unique, original and proprietary content by building audiences." said ODonnell "While many ecommerce-only sites were building their traffic in order to transact commerce, Salon.com was growing substantially by distributing our content across the Webs leading portals and creating one of the largest audiences at 3.4 million unique visitors in December 1999."
Salon.com has signed over 35 agreements with online and offline companies to distribute Salon.coms award-winning content through AOL, Lycos, Looksmart, TheStreet.com, Thedial.com, AvantGo and others.
In an effort to provide a meaningful comparison with analyst models, the net loss per share figures above and in the financial tables below have been presented on a pro forma basis which excludes non-cash charges and includes preferred shares as if the preferred shares were converted into common shares at the time of issuance.
Salon.com (www.salon.com; AOL Keyword: Salon) is an Internet media company that produces a network of 11 original content sites and two communities -- Table Talk and The Well. Salon.com was founded by David Talbot, former editor of the San Francisco Examiner. Premier advertisers and sponsors of Salon.com include IBM, Lexus, Microsoft, Virgin.com, Intel, DrKoop.com, barnesandnoble.com and EDS. Salon.com has relationships with over 325 advertising sponsors. In December 1999, Salon.coms network of Web sites had 3.4 million unique visitors.
Salon.com recently announced an equity and content agreement with Rainbow Media Holdings, Inc., a subsidiary of Cablevision Systems Corporation and NBC, to develop online content and Salon.com's first television series, targeted to air on Bravo Networks in Fall 2000.
This month, Salon.com announced a content agreement with Red Hat, a leading provider of OpenSource and Linux software. Salon.com also distributes its content to leading online and Internet companies such as America Online (AOL). Other Internet sites that carry Salon.com content on a regular basis include Lycos, Go.com, Alta Vista, Reuters, CNN.com and Cnet. In the wireless and handheld arenas, Salon.com has signed content distribution agreements with both AvantGo and Rocket eBooks. Salon.com also syndicates through United Features Syndicate. Salon.com has an ecommerce ticketing and advertising sponsorship sales agreement with CultureFinder.
This announcement contains forward-looking statements concerning revenue growth that involve risks and uncertainties including, among others, advertising sales, traffic, acceptance and effectiveness of Internet advertising, growth in use of the Internet, Salon.com's limited operating history, anticipated losses, the unpredictability of its future revenues, successful development of Salon.com's television show, competition, risks associated with system development and operation risks, management of potential growth and risks of new business areas, business combinations and strategic alliances. Actual results could differ materially from those discussed. More information about factors that potentially could affect Salon.com's financial results is included in the Company's filings with the Securities and Exchange Commission. All forward-looking statements are based on information available to the company on the date hereof, and the Company assumes no obligation to update such statements.
Note: Salon.com is a registered trademark of Salon.com. All other company and product names mentioned are trademarks of their respective owners.
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