Atrinsic Q3 2009 Operating Results

New York (November 11, 2009) - Atrinsic, Inc., (NASDAQ: ATRN), a leading online marketing services company, announced third quarter 2009 results today.

Revenues for the third quarter of 2009 were $14.9 million compared with $30.8 million in the third quarter of 2008, a decrease of 52%. Subscription revenue decreased by approximately $10.5 million, or 68%, to $4.9 million for the three months ended September 30, 2009, compared to $15.4 million for the three months ended September 30, 2008.

The decrease in subscription service revenue was principally attributable to a decrease in the average number of billable subscribers during the period as compared to the prior year period. Transactional revenue decreased by approximately $5.5 million or 35% to $10.0 million for the three months ended September 30, 2009 compared to $15.5 million for the three months ended September 30, 2008. The decrease was primarily attributable to the reduction in discretionary advertising expenditures by our clients.

Operating expenses for the third quarter of 2009 were $19.9 million compared with operating expenses of $30.8 million in the third quarter of 2008, a decrease of approximately $10.9 million. The decrease is primarily attributable to a reduced amount of purchased third party media, correlated to decreased revenues, and a reduction in labor and operating costs. During the quarter, the Company expended an estimated $2.0 million toward the continued development and launch of Kazaa. The Company is carefully monitoring its performance relative to expectations and market conditions to manage its fixed and discretionary customer acquisition, product development, and other operating expenses.

Adjusted EBITDA for the third quarter of 2009 was a loss of ($4.3) million compared with income of $1.3 million in the third quarter of 2008, a decrease of approximately $5.6 million. The decrease is primarily attributable to the decrease in revenue, partially offset by decreases in operating expenses, a portion of which Atrinsic has invested in new product and services development for future growth. Adjusted EBITDA is a non-GAAP measure - see Supplemental Disclosure regarding Non-GAAP Measures below.

Net loss for the third quarter of 2009 was ($2.4) million (($0.12) loss per basic and diluted share) compared with break even for the third quarter of 2008 ($0.00 earnings per basic and diluted share).

As of September 30, 2009, the Company had $17.6 million of cash, cash equivalents with adequate working capital to support future growth, business development initiatives, and capital activities.

Jeffrey Schwartz noted, "The results that we are releasing today are not acceptable and we recognize the need for change. We are evaluating all of our products and services with an eye toward simplifying our business and refocusing on our core. In so doing, I firmly believe that we can return the business to growth and profitability in the future".

Source: Atrinsic, Inc.