Net2Phone losses increase

Net2Phone said today it lost $20.3 million, excluding restructuring charges, or 35 cents per share, during its first fiscal quarter of 2002 ended October 31, 2001. That compares to a 25 loss per share in the first quarter of 2001 and a consensus analyst estimate of 33 cents per share.

For the quarter, the company’s revenue total $42.9 million, a 39% increase year-over-year, and a 61% jump in customers to 2.9 million. Of that total, the company’s majority-owned subsidiary ADIR Technologies contributed $2.2 million.

Newark, NJ-based Net2Phone is in the midst of a restructuring that will focus much of its future growth on the cable-telephony market. Liberty Media, which is part of a consortium that has a near majority voting share in Net2Phone, is currently working with the company on a proof-of-concept product that will be rolled out to the cable industry later next year.

As part of the cable strategy, Net2Phone also announced the hiring of Mark Dzuban, who previously served as senior vice president of telephony engineering and technical operations for AT&T Broadband.

Stephen Greenberg, CEO of Net2Phone, emphasized that the company isn’t necessarily turning away from its core services. “Our broadband strategy will just be gravy.”

Within those core services, Greenberg said the company is on the verge of executing an agreement with AT&T that will “again validate our technology.”

--Vince Vittore, executive editor