Mobile Marketing Firm Velti Forecasts $106 Million in 2009 Revenues
MocoNews Contributor Jeremy Laws runs a digital entertainment advisory and writes the industry blog Cabana Mobile.
Velti, a UK-based mobile marketing and advertising firm, which bought Ad Infuse last year, released preliminary numbers yesterday for fiscal year 2009. Velti said it now expects revenues to exceed $106 million for the year, representing 24 percent growth over 2008.
In the last year, the company claims to have run more than 2,000 campaigns for 450 brands, and indicated that demand for its products remains strong, reports StockMarketsReview.com. While the company is trying to spin the earnings as “in-line,” many analysts had them pegged in the $115 million range, so the company’s stock took a 3 percent hit in London trading yesterday.
It’ll be interesting to see the rest of the numbers when the full report is released in the next few weeks. Despite the near miss, Velti is probably the biggest player in the mobile advertising space with revenues more than double those of hyped U.S. plays like Millennial and AdMob (in the process of being acquired by Google (NSDQ: GOOG) for $750 million), and at least has five times the revenues of Quattro (which is being acquired by Apple (NSDQ: AAPL) for a rumored $275 million). Oh, and by the way, these guys actually turned a (real) net profit last year. One wonders why, in light of Velti’s performance and the recent frothy valuations of other companies in the sector, is its market cap is only around $153 million?
Their valuation is so low because they really don’t do anything particularly valuable. They’re not much more than a consulting company.
@An Observer — thanks for the comment and insight. My concern with the mobile ad networks is that while they arguably offer a scalable product in the short term, they’re super-overvalued considering that they ultimately offer indistinguishable/commoditizable services with relatively low barriers to entry. It seems to me that a true mobile advertising agency, with a depth of industrial knowledge (including how to leverage those networks), will have a lot of value for the vast number of big, rich brands out there (many just beginning to experiment in the medium) for the short and long term