RealNetworks Reports Advance Q4 Revenue Figures
February 3, 2009 at 5:16 AM (PT)
REALNETWORKS released preliminary fourth-quarter revenue figures in advance of its earnings announcement on FEBRUARY 12th, saying that the company expects to report revenue of $151-153 million, in line with guidance. The company says that it will also will report several charges totaling $227-249 million, with $4-5 million expected to result in a use of cash in future quarters.
Charges include a non-cash charge of $185-200 million for impairment of goodwill and acquired intangible assets; $20 million to write off certain deferred project costs and pre-paid royalties; a non-cash charge of $16-23 million to reflect an increase in the valuation allowance for deferred tax assets, net of the tax benefit related to the above mentioned items; and restructuring charges of approximately $6 million for a reduction in force and write-off of capitalized transaction-related costs associated with the spin-off of the company's games business into a separate company, although the company adds "there is no visibility as to when conditions will support separation. As a result, the company has postponed work with outside advisors, has stopped external spending on the transaction and will write off the capitalized costs in the fourth quarter."
In addition, the accounting for the quarterly gain on the 2007 sale of 49% of RHAPSODY AMERICA will not be reflected in the income statement in the fourth quarter due to declines in market valuations and the resultant decline in the assumed valuation of the venture. In this fourth quarter, an approximate $7 million gain will be recorded directly to shareholders' equity.
The company ended 2008 with approximately $370 million in cash and cash equivalents.