News Column

Blinkx Buys LYFE Mobile; Profit Up But Warns On Cost Increase

May 6, 2014

Steve McGrath

LONDON (Alliance News) - Internet media platform Blinkx PLC Tuesday said it had bought mobile and data management platform LYFE Mobile, as it reported higher profit and revenue for its last financial year but cautioned that costs are set to ramp up further due to investments in new technology.

The company, which provides companies with advertising for use with online videos, said it had bought LYFE Mobile for cash, though it didn't say how much. LYFE has technology that programmatically delivers relevant ads to consumers based on their geographic location and other attributes.

"At blinkx our growth strategy is focused on three key areas - video, mobile and programmatic, which we feel represent the future of digital advertising," said Blinkx Chief Executive S. Brian Mukherjee in a statement. "LYFE Mobile is one of those rare companies operating in the sector that delivers in all three areas for blinkx.

"The acquisition enables us to fill a critical gap in our product portfolio, which would have otherwise taken years to build. While the transaction will not have a material impact on revenue in the near term, and is currently loss making, it represents our first foray as a company into the demand side of the programmatic ecosystem," he added.

Separately, Blinkx reported a pretax profit of USD17.6 million for the year to March 31, from USD16.7 million a year earlier, as revenue rose to USD247.2 million, from USD198.0 million. Profit growth underperformed revenue growth as costs rose across the fast-expanding business, from research and development to sales and marketing.

"In order to achieve company goals for scale, scope and reach across multiple advertising channels, we are taking steps to reallocate resources to emerging channels, including mobile and connected TV. We expect this shift to incur a marginal incremental operating cost," it said in its outlook statement.

Blinkx shares were down 7.3% at 85.75 pence Tuesday morning.

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Source: Alliance News

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