I'm a day or two late on this, but I finally browsed through Napster's earnings release for Q1 2007. Here are the quick bullets:

• Revenue rose to a record $32.3 million, a 15% increase year over year.
• Net loss for the quarter was $4.2 million, an improvement from last year's $8.5 million loss.
• Subscribers dropped 2.5% as the company lost 40,000 university students.
• Cash flow from operations was positive -- $1.6 million versus negative cash flow of $8 million last year.
• Cash on hand dropped 28% to $30.6 million
• Gross margin dropped to 27.3% from 32%, though operating expense as a percent of revenue dropped sharply to 44% from 69%.

Overall, the quarterly earnings release was very encouraging. Napster now has 770,000 subscribers and its financials are coming around. I listened to part of the conference call. Management is betting on wireless to carry its earnings growth, especially in Japan. They're looking at new hardware partners this fall. Marketing has been shifted from ad buys to partnerships, which should be good for cash burn. Napster didn't break out the number of AOL subscribers it added but did say "it is living up to our expectations." The company has no plans to change its pricing but did not say much about it. Lastly, over the next fiscal year, Napster expects 20 million compatible mobile phones.

[music jobs] Brand and Online Marketing Manager at The Ascot Club/Am Only; Brooklyn, NY.