Motricity, which is in the increasingly tough business of providing back-end infrastructure to U.S. wireless carriers, lost $1.5 million on revenues of $29.1 million in the first quarter 2010, according to an SEC filing.
The Bellevue, Wash.-based company, which filed its registration papers back in January and is seeking $250 million in a public offering, reported that revenues increased by almost 25 percent compared to the same period a year ago, while the company’s losses narrowed significantly to $1.5 million from $69.7 million.
Most of Motricity’s current business is focused helping carriers sell mobile content, such as ringtones, applications and other services, to its end-users. However, that business is increasingly at risk as customers go directly to the web for content, or download applications from third-parties. In March, Motricity announced a three-part overhaul of its carrier offerings that attempts to bring them — and their customers — up to speed in the areas of applications, advertising and social networking. The company did not mention these new services in the filing, likely because they are too new to register any revenues.
Despite these overall trends, Motricity said storefront revenues continue to rise. In the first quarter, the company said managed service revenues increased $700,000, or 3.3 percent to $20.9 million. However, the amount of revenues obtained on a per transaction fell because one of its carriers converted a contract to a fixed fee arrangement. In the first quarter, user-based fees made up about 52 percent of revenues vs. 76 percent in the year-ago period. In addition, the average monthly number of users on the company’s “non-messaging based solutions” decreased to 34.4 million from 34.5 million in the comparable period of 2009.

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