RealNetworks posts income loss and reports president's resignation

RealNetworks has posted a loss of $10.4m for the first quarter of 2004 and its president, Lawrence Jacobson, has resigned.

RealNetworks has posted a loss of $10.4m for the first quarter of 2004 and its president, Lawrence Jacobson, has resigned.

After working for the digital media company for three years, Jacobson served his notice "to pursue other opportunities and spend more time with his family", RealNetworks said.

Jacobson will continue to work temporarily for the company as a strategic adviser, and RealNetworks has no plans to fill the position of president at this time.

Assuming Jacobson's responsibility for running the company’s international operations, RealNetworks has promoted senior vice-president of marketing Dan Sheeran to senior vice-president international.

RealNetworks' reported a $10.4m (£5.9m) net loss for the quarter ending 31 March was almost double its net loss of $5.3m in the fourth quarter of 2003. On a year-on-year basis, in the first quarter of 2003 the company posted a net loss of $2.8m.

The company said the bulk of its losses in the first quarter was because of expenses related to the removal of PGA Tour content from its subscription services (a loss of $4.9m) and the costs of RealNetworks' antitrust litigation ($2.3m). Excluding those expenses, the net loss was $3.2m.

RealNetworks lodged a private suit against Microsoft last year, accusing the software giant of using its monopoly powers to control the digital media market.

Revenue for the quarter was $60.4m, up 29% from the first quarter of 2003 and an increase of 12% from the fourth quarter of 2003.

RealNetworks credited the growth in revenue to robust consumer services, particularly in music and games. The company said it has more than 450,000 subscribers to its digital music services.

The company's first quarter results also included approximately $2m of revenue associated with the acquisition of GameHouse in January.

RealNetworks expected its momentum to continue and forecast a return to quarterly profitability by the end of 2004.

Laura Rohde writes for IDG News Service

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