Rosetta Stone 2010 Annual Report Download - page 77

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Table of Contents
ROSETTA STONE INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
Year Ended December 31,
2010 2009 2008
Revenue:
Product $ 215,590 $ 218,549 $ 184,182
Subscription and service 43,278 33,722 25,198
Total revenue 258,868 252,271 209,380
Cost of revenue:
Cost of product revenue 32,549 30,264 26,539
Cost of subscription and service revenue 6,450 3,163 2,137
Total cost of revenue 38,999 33,427 28,676
Gross profit 219,869 218,844 180,704
Operating expenses
Sales and marketing 130,879 114,899 93,384
Research and development 23,437 26,239 18,387
General and administrative 53,239 57,182 39,577
Lease abandonment (583) (8) 1,831
Total operating expenses 206,972 198,312 153,179
Income from operations 12,897 20,532 27,525
Other income and expense:
Interest income 262 159 454
Interest expense (66) (356) (891)
Other income (expense) (220) 112 239
Total other income (expense) (24) (85) (198)
Income before income taxes 12,873 20,447 27,327
Income tax provision (benefit) (411) 7,084 13,435
Net income $ 13,284 $ 13,363 $ 13,892
Net income per share:
Basic $ 0.65 $ 0.89 $ 7.29
Diluted $ 0.63 $ 0.67 $ 0.82
Common shares and equivalents outstanding:
Basic weighted average shares 20,439 14,990 1,905
Diluted weighted average shares 21,187 19,930 16,924
See accompanying notes to consolidated financial statements.
F-5