When Snap Interactive Inc (OTC:STVI) proudly revealed on Jun. 15 that its fully-integrated mobile iPhone and Facebook app WhoIsNear.com had reached in excess of 1 million installs in less than four months, its subsequent stock market performance was nothing short of disappointing. Instead of embarking on a glorious ride on the charts, STVI stock went down 9% following the PR, only to sink further 25% during the next session.
Three weeks later, STVI stock somehow managed to attract investor interest yesterday. Shifting in excess of 439 thousand shares, STVI gained one cent to close at $0.91 per share and mark a symbolic 1.11% improvement over Wednesday, when it plummeted 15% on a much lower turnover of 177K. Since no corporate updates have popped up ever since, STVI supporters are now building their hopes up for some striking follow-ups.
Apart from whoisnear.com, Snap Interactive Inc. has developed another Facebook-compatible mobile application, i.e AreYouInterested.com. The latter appears to be an online dating platform and, as seen from its Alexa traffic rank, is currently much more widespread with some 40 million installs. According to CEO Clifford Lerner, STVI’s focus of attention in the short-term will be aimed at improving its location-based social app by expanding its set of features in order to compete for a larger market share.
Besides customers, STVI attempts to take care also of its stockholders by following a transparent financial policy. As an OTCQB market player, the company is a registered SEC filer. In this respect, investors recently gained access to STVI’s latest 10-Q report. Encompassing the first calendar quarter of 2011, the unaudited document contained:
- cash reserves in excess of $10.2 million as opposed to $3 million accumulated by Dec. 31, 2010;
- working capital surplus of $7.6 million vs. $0.56 million in the preceding quarter;
- $3.74 million in revenue in comparison with $0.93 million in Q1 of 2010;
- quarterly net loss of $920 thousand as compared to $803K on an annual basis.
While SVTI’s cash and working capital reserves are indeed indicative of how attractive the social media industry is nowadays, the company appears to have gone the extra mile with regard to its advertising and marketing expense, hence the net loss mentioned above. Yet, as long as SVTI continues to expand at a similar rate, it will most probably turn profitable within the next couple of quarters.
