MVNO Virgin Mobile USA reported a net loss of $14.7 million during the fourth quarter last year, while revenue rose 10 percent year-on-year to $326.5 million, but still shy of the expected $347.1 million. Virgin Mobile USA blamed "economic conditions" for the loss and warned that the conditions will continue to affect the consumer market and wireless industry during 2008.
Thomas Weisel Partners analyst James Breen noted that Virgin Mobile USA's customers are typically from lower income brackets or have credit problems, which is why they use prepaid phone service. "A slowing economy can be particularly tough on these customers as they look to cut costs to stay afloat," Breen wrote in a research note.
The MVNO said it expects revenue for 2008 to be "broadly in line" with revenue figures from 2007, and it plans to add between 5,000 and 20,000 new subscribers during the first quarter. By contrast, the company added 310,000 during the first quarter of 2007.
For more on Virgin Mobile's Q4:
- check out this press release
- also check out this article from the AP