SOURCE: SNAP Interactive, Inc.

SNAP Interactive - Online Dating for Social Networks

August 17, 2010 10:07 ET

SNAP Interactive Releases Q2 2010 Operating Results

NEW YORK, NY--(Marketwire - August 17, 2010) - SNAP Interactive, Inc. ("SNAP" or the "Company") (OTCBB: STVI), a leading social dating application provider with more than 25 million installs across its social dating applications, today announced operating results for the quarter ended June 30, 2010.

Financial Highlights

  • Revenue increased 58% from $784,242 for the three months ended June 30, 2009 to $1,243,082 for the three months ended June 30, 2010, an increase of $458,840.

  • Q2 2010 Revenue: $1,243,082 as compared to $927,436 in Q1 2010, an increase of 34% -- representing sequential revenue growth for the fifth consecutive quarter

  • Q2 2010 gross cash receipts of more than $1,411,000 

(A description of results follows below.)

"As we continue to ramp up the subscription model on the AreYouInterested.com online dating brand we're very excited to see our efforts beginning to pay off with consistent revenue growth," stated SNAP President and CEO Clifford Lerner. "This growth is highlighted by the largest quarterly revenue in the Company's history in Q2 2010. We continue to see month-to-month increases in gross cash receipts and we're excited to report that Q3 2010 is off to an even stronger start. July 2010 gross cash receipts increased nearly 15% over the previous month and we're seeing similar growth so far in August as well. Our margins improved considerably in the Q2 2010 from the previous quarter as recurring revenue grew and our user acquisition models became more optimized. Due to our revenue recognition policy, which requires us to recognize revenue over the term of a user's subscription period, our gross cash receipts exceeded revenue during the quarter, which caused an increase in deferred revenue as we continue to ramp up our subscriptions."

Due to GAAP accounting, revenues from multi month subscriptions are recognized over the length of the subscription term rather than when purchased. Because the majority of our subscription sales occurred from subscriptions with a term of three or six months, we apportion that revenue over the duration of the subscription term even though it is collected in full at the time of purchase. As a result, a portion of the gross cash receipts from subscription purchases may not be recognized in the quarter in which the subscription was actually purchased. The difference between the gross cash receipts collected and the recognized revenue from those sales during that reporting period per our financials will appear as deferred revenue. As of June 30, 2010 this deferred revenue amount was $722,866.

Operational Results Description

Revenues
Revenue increased from $784,242 for the three months ended June 30, 2009 to $ 1,243,082 for the three months ended June 30, 2010, an increase of $458,840. Revenues increased from $1,553,214 for the six months ended June 30, 2009 to $2,170,518 for the six months ended June 30, 2010, an increase of $617,304. These revenues are primarily generated from subscription fees for subscriptions to Are You Interested as well as access to premium features on our products. The increase in revenue for the three months ended June 30, 2010 was primarily due to the implementation of subscriptions on our Are You Interested brand which took place in late 2009.

Net Income
Net income decreased to a net loss of $68,861 for the three months ended June 30, 2010 from net income of $46,430 for the three months ended June 30, 2009, a decrease of $115,291. Net income decreased to a net loss of $872,311 for the six months ended June 30, 2010 from net income of $112,902 for the six months ended June 30, 2009, a decrease of $985,213. The decrease in net income and shift to a net loss was primarily due to the revenue recognition impact of our shift to a subscription model in which revenue is recognized on a deferred basis when subscriptions occur over more than a single month as well as increased user acquisition costs associated with the shift to a subscription model on the Are You Interested brand.

To view the entire 10-Q filing please visit:

http://sec.gov/Archives/edgar/data/1355839/000121390010003243/f10q0610_snap.htm 

About SNAP Interactive, Inc.
SNAP Interactive, Inc. is a leading provider of online dating applications for social networking websites and mobile platforms. SNAP has developed two social dating applications built on Facebook® Platform which have more than 25 million installations on Facebook. SNAP's portfolio is highlighted by the AreYouInterested.com? brand which consists of AreYouInterested.com, the AreYouInterested? iPhone Dating Application, and the AreYouInterested? Facebook Application. For more information visit www.snap-interactive.com.

Facebook® is a registered trademark of Facebook Inc. iPhone™ is a trademark of Apple Inc.

Forward-Looking Safe Harbor Statement:
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. By their nature, forward-looking statements and forecasts involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the near future. There are a number of factors that could cause actual results and developments to differ materially from forecasted results. These risks and uncertainties include our ability to: attract members; convert members into paying subscribers and retain our paying subscribers; our ability to successfully implement our current long-term growth strategy; as well as product demand, market competition, fluctuations in advertising payouts, reliance on credit card processors and related necessary merchant account approvals, delays in website & application development, technical issues beyond our control, reliance on the various platforms that we build applications on, and risks inherent in our operations. For a discussion of these risks and uncertainties, please see our filings with the Securities and Exchange Commission. Our public filings with the SEC are available from commercial document retrieval services and at the website maintained by the SEC at http://www.sec.gov.

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