Stamps.com 2015 Annual Report Download - page 43

2014 2013
Revenues    
Service $ 115,696 $ 99,013
Product  16,883  16,580
Insurance  9,217  7,515
PhotoStamps  5,450  4,710
Other  23  1
Totalrevenues $ 147,269 $ 127,819
Revenueasapercentageoftotalrevenues    
Service  79%  77%
Product  11%  13%
Insurance  6%  6%
PhotoStamps  4%  4%
Other  0%  0%
Totalrevenues  100%  100%
TABLE OF CONTENTS
Revenue by Product
Thefollowingtableshowsourcomponentsofrevenueandtheirrespectivepercentagesoftotalrevenuefortheperiodsindicated
(inthousandsexceptpercentage):
Ourrevenuewasderivedprimarilyfromfivesources:(1)serviceandtransactionrevenuesrelatedtoourmailingandshipping
services;(2)productrevenuefromthedirectsaleofconsumablesandsuppliesthroughourSuppliesStore;(3)packageinsurance
revenuefromourbrandedinsuranceofferings;(4)PhotoStampsrevenuefromthesaleofPhotoStampspostagelabels;and(5)other
revenue,consistingofadvertisingrevenuederivedfromadvertisingprogramswithourexistingcustomers.
Servicerevenueincreased17%to$115.7millionin2014from$99.0millionin2013.The17%increaseinservicerevenue
primarilyconsistedofan18%increaseinservicerevenuefromourCoremailingandshippingbusinesswhiletheservicerevenuefrom
ourNon-Coremailingandshippingbusinessdecreased27%.The18%increaseinourCoremailingandshippingservicerevenue
consistedofa7%increaseinourannualaveragepaidcustomersand10%increaseinourannualaveragerevenueperpaidcustomer.
Productrevenueincreased2%to$16.9millionin2014from$16.6millionin2013.Theincreasewasprimarilyattributabletothe
following:(1)increaseinlabelsales;(2)growthinourpaidcustomerbase;(3)thepostalrateincreaseinJanuary2014,which
generatedincrementallabelsalesfortheperiodoftimearoundtherateincrease;(4)marketingourSuppliesStoretoourexisting
customerbase;and(5)growthinpostageprinted,whichhelpsdrivesalesofconsumablesuppliessuchaslabels.Totalpostageprinted
bycustomersusingourservicein2014was$1.8billion,a13%increasefromthe$1.6billionprintedin2013.
Insurancerevenueincreased23%to$9.2millionin2014from$7.5millionin2013.Theincreaseininsurancerevenuewas
primarilyattributabletoincreasedpackageinsurancepurchasesasaresultofourgrowthinpackagesshipped.Growthinpackages
shippedwasattributabletobothorganicgrowththroughStamps.com’smailingandshippingsolutionsaswellasourrecentacquisitions
whosesolutionstargetshippingcustomerswhoaremorelikelythanmailingcustomerstopurchaseinsurance.
PhotoStampsrevenueincreased16%to$5.4millionin2014from$4.7millionin2013.Theincreasewasprimarilyattributableto
anincreaseinhighvolumebusinessorderswhichhavebecomeahigherpercentageofPhotoStampsrevenuebutarelesspredictable
andcreategreaterfluctuationsinourPhotoStampsrevenuenumbers.TheincreaseinPhotoStampsrevenuewaspartiallyoffsetbya
decreaseinPhotoStampsrevenuefromordersplacedthroughourwebsite.Thedecreaseinrevenuefromwebsiteorderswasprimarily
attributabletoareductioninourPhotoStampssalesandmarketingspendingin2014comparedwiththatof2013.TotalPhotoStamps
sheetsshippedin2014increased31%to338,000comparedto257,000in2013andaveragerevenueperPhotoStampssheetshipped
decreased12%to$16.14in2014comparedto$18.30in2013.Theincreaseinsheetsshippedanddecreaseinaveragerevenueper
PhotoStampssheetwerebothprimarilyattributabletoincreasedbusinessorderswhichsellinlargersheetvolumesbuttypicallyhavea
lowerpricepersheet.
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