Northern, WI 2/15/12 (StreetBeat) -- Vonage (NYSE: VG) shares are trading sharply lower Wednesday morning following the company’s Q4 earnings report, which included a warning that increased investment in the business will reduce its financial performance in 2012.For the fourth quarter, the voice over IP telephony company posted revenue of $216 million, a hair below the Q3 level at $217 million, the year-ago quarter at $218 million and the Street consensus, also $218 million. Non-GAAP profits were 11 cents a share, in line with estimates. The company posted adjusted EBITDA in the quarter of $40 million. The company noted that this was the fifth consecutive quarter with EBITDA of $40 million or better – but that is about to end.
“”Now that we have stabilized our core business and are generating meaningful cash flow, we will accelerate our investment in strategic growth initiatives during 2012,” CEO Marc Lefar said in a statement. “While reducing adjusted EBITDA in the short term, we believe this investment will fund growth in mobile and geographic expansion. Even with this increased level of funding, we expect to further strengthen our cash position during the year.”
The company sees quarterly EBITDA in 2012 running in the $30 million to $35 million range, with annual EBITDA of $120 million to $140 million, which would be down from $168 million in 2011.
VG this morning is down 29 cents, or 10.6%, to $2.44.
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