Business Breaking News

The Canadian Press - ONLINE EDITION

Pandora CEO Joseph Kennedy is stepping down; shares jump on upbeat mobile revenue

By: The Associated Press

Thursday, Mar. 7, 2013 at 5:55 PM | Comments: 0

OAKLAND, Calif. - Shares of Internet radio pioneer Pandora Media Inc. shot up on Thursday after the company said CEO Joseph Kennedy is stepping down and it reported a narrower loss and higher revenue in the fourth quarter than analysts expected.

Revenue from mobile ads also grew faster than listening on mobile devices, easing a key investor concern about the company's ability to make a profit from the booming segment.

Shares jumped $2.42, or 20.6 per cent, to $14.15 in after-hours trading. The last time Pandora hit $14 was Jan. 27, 2012.

Kennedy, 53, has led the company as chairman and CEO since July 2004, will step down after a successor is found.

"As part of our board discussions of the road that lies ahead, I reached the conclusion and advised the board that the time is right to begin a process to identify my successor," Kennedy said in a statement.

The company also said Thursday that it lost $14.6 million, or 9 cents per share, in the three months through Jan. 31. That compares with a loss of $8.2 million, or 5 cents per share, a year earlier.

Excluding the cost of compensating executives with stock, the adjusted loss came to 4 cents per share, slightly better than the loss of 5 cents per share expected by analysts polled by FactSet.

Revenue grew 54 per cent to $125.1 million, more than the $122.8 million Wall Street expected.

Revenue from mobile devices grew 111 per cent to $80.3 million, outpacing the growth in mobile listening of 70 per cent.

The company's ability to sell ads on mobile devices is a key concern because royalty costs rise every time a listener plays a song. Those concerns grew last week, when the company said it would cap free listening on mobile devices at 40 hours per month, suggesting it was having trouble with rising costs.

The company said that its total listener hours climbed 53 per cent to 4.05 billion hours compared to the same period a year before. That same measure increased by 42 per cent for February to 1.38 billion.

Pandora also forecast an adjusted first-quarter loss of 10 to 13 cents per share. It expects revenue of $120 million to $125 million for the period. Analysts had forecast a loss of 10 cents per share on revenue of $119 million.

The company said full year adjusted earnings could range from a loss of 5 cents per share to a gain of 5 cents per share. It expects revenue of $600 million to $620 million. Analysts forecast a loss of a penny per share on revenue of $602 million.

Rate this
This article has not yet been rated.

We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high. If you thought it was well written, do the same. If it doesn’t meet your standards, mark it accordingly.

You can also register and/or login to the site and join the conversation by leaving a comment.

Rate it yourself by rolling over the stars and clicking when you reach your desired rating. We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high.

Sort by: Newest to Oldest | Oldest to Newest | Most Popular 0 Comments

You can comment on most stories on brandonsun.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

There are no comments at the moment. Be the first to post a comment below.

Post Your Comment

The Brandon Sun does not necessarily endorse any of the views posted. Comments are moderated before publication. By submitting your comment, you agree to our Terms and Conditions. New to commenting? Check out our Frequently Asked Questions.