Angie's List Inc.'s net loss shrank to $14.3 million in the second quarter compared with a $23.4 million loss in the year-earlier period, in large part because the amount of money committed to by the service providers rated on the site rose 63%, the company reported today.
With the losses for the March-through-June period, Angie's List now has posted net losses totaling $163.4 million since 2009, financial reports from the Indianapolis-based review site show. But the company's news release focused instead on growth, such as the 51% increase in total paid memberships from 2012's second quarter to total 2.2 million, or the 42% rise in "participating service vendors" to 42,452.
Angie's List gets the vast bulk of its revenues from contracts that those service providers--including remodelers and medical professions--sign to advertise on the Angie's List site and in its publications as well as take part in e-commerce transactions. The value of those contracts as of June 30 totaled $165.6 million, up sharply from $101.7 million a year before. Advertising revenue rose 76% in the quarter from the year before to hit $38.3 million, while e-commerce revenue gained 44% to reach $5 million. Membership revenue totaled $15.9 million, up 41%.
"We are reporting record levels for memberships added, service provider revenue and total revenue, as well as continued efficiencies in our cost per member acquired," Angie's List CEO Bill Oesterle said in the news release. "We achieved these results while simultaneously improving our operating leverage and producing cash flow."
The losses came in part because the total revenue of $59.2 million was more than offset by $22 million in selling expense and $28 million worth of marketing. The company's announcement didn't list operational and general expenses, but based on past SEC filings, those added costs are likely to have been what kept Angie's List in the red.
--Webb is editor-in-chief of REMODELING. Follow him on Twitter at @craiglwebb and REMODELING at @remodelingmag.