Helio losses grow, but so do revenues
Mobile virtual network operator Helio continues to hemorrhage cash … but on the bright side, its 2007 revenues increased 264 percent over the previous year. In its annual report to the SEC, Internet service provider EarthLink, which launched Helio in conjunction with Korean mobile operator SK Telecom, notes Helio lost $327 million in 2007 against $171 million in revenue; a year ago, the MVNO posted losses of $192 million on $47 million of revenue, which combined with 2005 losses of $42 million means Helio has now posted total losses of $560 million in three years. Helio ended the fourth quarter with slightly more than 180,000 subscribers, a 28 percent increase over Q3 totals. But while revenue still exceeded Helio's $140-$170 million guidance, and losses fell shy of its $340 million to $360 million guidance, EarthLink admits in the SEC filing it "may not realize the benefits we sought from our investment in the Helio joint venture."
The EarthLink filing goes on to note "We have made $210 million of cash investments in Helio. The financing of Helio's operations has adversely affected our cash position. In addition, Helio will require additional funding in the future and Helio has incurred losses and we expect Helio to continue to incur losses. In addition, Helio may not be successful in implementing and marketing its wireless voice and data initiatives, and there can be no assurance that these initiatives will be commercially successful. We cannot assure you Helio will be able to achieve or maintain adequate market share or revenue or compete effectively."
For more on Helio's 2007 results:
- read this Silicon Alley Insider article