Shares of streaming service Vimeo (VMEO 5.43%) jumped as much as 25.1% in trading on Tuesday after the company reported third-quarter financial results. At 1 p.m. ET shares had given back some of their gains but were still up 9.6% on the day.
Where Vimeo improved in the quarter
Revenue was down slightly from $108.1 million a year ago to $106.3 million, but Vimeo reported $8.5 million in net income, or $0.05 per share, compared to a $21.4 million loss a year ago. The reason was operating costs dropped from $105.8 million a year ago to $78.8 million.
Analysts were only expecting $106 million in revenue and earnings of a penny per share on an adjusted basis.
Tepid signs of recovery
Management said that total bookings for the quarter was $100 million, which was down from $104 million in bookings a quarter ago.
Enterprise customers are showing strong bookings, which jumped from $7.5 million two years ago to $18 million this quarter. In that time, revenue has increased from $6 million to $15.2 million.
Self-serve customers are not growing at the same rate, with bookings down to $67.4 million from $74.1 million two year ago. And revenue has been flat over that time.
The market is focused on the bottom line today and for good reason. Investors are demanding more profits as yields rise, so proving Vimeo could be profitable was enough to impress the market. Now, it needs to become a growth company again.
