Wed, 10/30/2013

2013 Press Releases


SEATTLE, Oct. 30, 2013RealNetworks, Inc. (NASDAQ: RNWK) today announced results for the thirdquarter ended September 30, 2013.

Financial Summary

  • Revenue of $49.0 million
  • Net loss of $(31.4) million or $(0.88) per share
  • Adjusted EBITDA loss of $(8.4) million
  • Cash and short-term investments of $218.4 million as of September 30, 2013


Recent Highlights

  • On September 24, launched RealPlayer Cloud, the first integrated video player and cloud service
  • Acquired Muzicall Limited, a leading service provider for mobile carriers and media companies inEurope, for $6.7 million
  • Settled our two most significant outstanding litigation matters for an aggregate of $11.5 million


For the third quarter of 2013, revenue was $49.0 million, a sequential decrease of (2)% from the second quarterof 2013, and a decrease of (17)% compared with the third quarter of 2012. Revenue trends in each ofRealNetworks' businesses in the third quarter of 2013 compared with the year-earlier quarter were: a (18)%decrease in RealPlayer Group revenue to $17.6 million, a (13)% decrease in Mobile Entertainment revenue to$19.9 million and a (24)% decrease in Games revenue to $11.4 million.

Net loss for the third quarter of 2013 was $(31.4) million, or $(0.88) per share, compared with net loss of$(22.2) million, or $(0.63) per share, in the third quarter of 2012.

Adjusted EBITDA loss for the third quarter of 2013 was $(8.4) million, compared with an adjusted EBITDAloss of $(6.0) million for the third quarter of 2012. A reconciliation of GAAP operating income (loss) toadjusted EBITDA is provided in the financial tables that accompany this release.

As of September 30, 2013, RealNetworks had $218.4 million in unrestricted cash, cash equivalents and shortterminvestments compared with $271.4 million as of December 31, 2012, of which approximately $37.5million was held in foreign jurisdictions. In addition, RealNetworks had $39.5 million in restricted cash andavailable-for-sale securities as of September 30, 2013, compared with $44.3 million as of December 31, 2012.

Segment Operating Results

Business Outlook

For the fourth quarter of 2013, RealNetworks expects total revenue of $47.0 million to $50.0 million, with allsegments declining year over year, Mobile Entertainment increasing, Games flat and RealPlayer Groupdeclining sequentially. We expect adjusted EBITDA for the quarter to be a loss of $(8.0) million to $(11.0)million.

The foregoing forward-looking statements reflect RealNetworks' expectations as of October 30, 2013. It is notRealNetworks' general practice to update these forward-looking statements until its next quarterly resultsannouncement.

Webcast and Conference Call Information
The company will host an audio Webcast conference call to review results and discuss the company's operations for the third quarter at 5:00 p.m. ET on October 30. The Webcast will be available at: http://
The on-demand Webcast will be available beginning approximately two hours following the conclusion of the live Webcast.

Conference Call Details
5 p.m. ET / 2 p.m. PT
Dial in:
888-790-3162 Domestic
415-228-4854 International
Passcode: Third Quarter Earnings
Leader: Rob Glaser

Telephonic replay will be available until 8 p.m. ET, November 20, 2013.
Replay dial in:
800-568-9796 Domestic
203-369-3292 International
Passcode: 103013


For More Information
Investor Relations:

About RealNetworks
RealNetworks creates innovative applications and services that make it easy to connect with and enjoy digitalmedia. RealNetworks invented the streaming media category in 1995 and continues to connect consumers withtheir digital media both directly and through partners, aiming to support every network, device, media type andsocial network. RealNetworks' corporate information is located at

RealNetworks, RealPlayer and GameHouse are trademarks or registered trademarks of RealNetworks, Inc. or itssubsidiaries. All other companies or products listed herein are trademarks or registered trademarks of theirrespective owners.

About Non-GAAP Financial Measures
To supplement RealNetworks' consolidated financial information presented in accordance with GAAP in thispress release, the company also discloses certain non-GAAP financial measures, including adjusted EBITDAand adjusted EBITDA by reportable segment, which management believes provide investors with usefulinformation.

In the financial tables of our earnings press release, RealNetworks has included reconciliations of GAAPoperating income (loss) to adjusted EBITDA and to adjusted EBITDA by reportable segment.

The rationale for management's use of non-GAAP measures is included in the supplementary materialspresented with the third quarter earnings materials. Please refer to Exhibit 99.2 (“Information Regarding Non-GAAP Financial Measures”) to the company's report on Form 8-K, which is being submitted today to the SEC.

Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties, including statementsrelating to RealNetworks' current expectations regarding future revenue and adjusted EBITDA, future marketperformance, and its plans to attain growth and profitability and undertake certain strategic initiatives. Allstatements contained in this press release that do not relate to matters of historical fact should be consideredforward-looking statements. Actual results may differ materially from the results predicted. Factors that couldcause actual results to differ from the results predicted include: RealNetworks' ability to realize operatingefficiencies, growth and other benefits from the implementation of its growth plan, strategic initiatives, andrestructuring efforts; the emergence of new entrants and competition in the market for digital media productsand services; other competitive risks, including the growth of competing technologies, products and services; the potential outcomes and effects of claims and legal proceedings on RealNetworks' business, prospects,financial condition or results of operations; risks associated with key customer or strategic relationships,business acquisitions and the introduction of new products and services; changes in consumer and advertisingspending in response to disruptions in the global financial markets; fluctuations in foreign currencies; andchanges in RealNetworks' effective tax rate. More information about potential risk factors that could affectRealNetworks' business and financial results is included in RealNetworks' annual report on Form 10-K for themost recent year ended December 31, its quarterly reports on Form 10-Q and in other reports and documentsfiled by RealNetworks from time to time with the Securities and Exchange Commission. The preparation ofRealNetworks' financial statements and forward-looking financial guidance requires the company to makeestimates and assumptions that affect the reported amount of assets and liabilities, and revenues and expensesduring the reported period. Actual results may differ materially from these estimates under differentassumptions or conditions. The company assumes no obligation to update any forward-looking statements orinformation, which are in effect as of their respective dates.