Stamps.com 2009 Annual Report Download - page 34

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TABLE OF CONTENTS
The following table sets forth our results of operations as a percentage of total revenue for the periods indicated:
Revenue
Service revenue increased 10% to $61.6 million in 2008 from $55.9 million in 2007. The increase in service revenue is
primarily due to the increase in our successfully billed customers as a result of the growth in our customer base. As a percentage
of total revenue, service revenue increased to 73% in 2008 from 65% in 2007, primarily as a result of the decrease in revenue
from our PhotoStamps product.
Product revenue increased 3% to $9.9 million in 2008 from $9.6 million in 2007. The increase in product revenue was
primarily attributable to growth in the number of orders, partially offset by a decline in the average revenue per order. As a
percentage of total revenue, product revenue increased to 12% in 2008 from 11% in 2007.
Insurance revenue increased 6.5% to $1.6 million in 2008 from $1.5 million in 2007, primarily as a result of an increase in
insurance transactions and average of dollar value insured per transaction. As a percentage of total revenue, insurance revenue
was 2% in each of 2008 and 2007.
PhotoStamps revenue decreased 34% to $11.9 million in 2008 from $17.9 million in 2007. The decrease in revenue was
primarily attributable to a decrease in the number of sheets shipped, as a result of our reduction in PhotoStamps consumer sales
and marketing spending as we focused on profitability. As a percentage of total revenue, PhotoStamps revenue decreased to 14%
Twelve Months Ended
December 31,
2008
2007
Total Revenues:
Service
72.5
%
65.2
%
Product
11.7
%
11.2
%
Insurance
1.8
%
1.7
%
PhotoStamps
14.0
%
20.8
%
Other
0.0
%
1.1
%
Total revenues
100.0
%
100.0
%
Cost of revenues:
Service
12.2
%
11.3
%
Product
4.2
%
3.8
%
Insurance
0.6
%
0.5
%
PhotoStamps
10.0
%
13.8
%
Other
0.0
%
0.1
%
Total cost of revenues
27.0
%
29.5
%
Gross profit
73.0
%
70.5
%
Operating expenses:
Sales and marketing
39.5
%
38.6
%
Research and development
9.9
%
9.6
%
General and administrative
18.3
%
14.6
%
Total operating expenses
67.7
%
62.8
%
Income from operations
5.3
%
7.7
%
Other income, net
3.4
%
5.2
%
Income before income taxes
8.7
%
12.9
%
(Benefit) provision for income taxes
-
3.3
%
0.5
%
Net income
12.0
%
12.4
%