Ibasis conducted their Q1 2008 earnings call on Monday and the news was not good. Their stock tumbled almost $1 on the news of the poorer than expected results. They posted a loss of $2.1 million, or 3 cents per share, on sales of $324.9 million dollars.
As for their retail calling card business here is how Ofer Gneezy addressed the topic:
"The retail prepaid calling card market was hampered this quarter by the general softness in the US economy and other factors affecting the employment of migrant workers, a demographic that the accounts for a significant portion of prepaid calling card usage. This factors in the continued effect of the industry transition to more transparent pricing combined to put pressure on our retail business in the quarter. Along with other major providers in the calling card industry, iBasis is playing a leadership role in the creation of an independent association of prepaid calling card providers that will establish standards of ethical business practices and monitor the industry and effectively certify vendor services. We believe this trend is very positive for consumers of prepaid calling products and for iBasis, as we have a significant advantage in our network in low cost of operations. In the mean time, we continue to work with high integrity distributors and market quality products that create value in the iBasis brand."Sounds like a chapter taken right out of IDT's earnings call to explain the poor performance of the calling card business. Why can't these guys just come right out and say it that the phone card buisiness is not and will not be what it used to be! At least they could help manage investors excpectations. The quote above is from the full earning call transcript which can be viewed at Seeking Alpha.
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