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Thanks, Yodle! Web.com Credits Acquisition with Boost in Per User Revenue

Thanks, Yodle! Web.com Credits Acquisition with Boost in Per User Revenue - Web.com Earnings Report Q2 2016

Six months after it acquired [1] Yodle, Web.com is now seeing an increase in average revenue per user. And it appears as if the acquisition of the new company is part of the reason.

Web.com Earnings Report Q2 2016

In its second quarter results, the web services company announced its average revenue per user was $18.66 compared to $13.91 for the same quarter last year. The company also said it added 3.4 million subscribers with 20,000 net additions.

Web.com said its total revenue was $187.8 million, compared to $135.7 million for the second quarter of 2015.

The company posted a trailing twelve month customer retention rate of 86.5 percent.

What’s worth noting is that Web.com is seeing impressive growth since it acquired online marketing company Yodle in March this year. In the first quarter of 2016 [2] total net subscribers jumped to 3,423,000, up 70,000 from the end of the fourth quarter of 2015.

New York-based Yodle specializes in assisting small businesses improve their online presence using emails, paid search advertising and search engine optimization.

David L. Brown, Chairman, CEO and President of Web.com said, “Following the acquisition of Yodle, we restructured the organization [3] to better align the Company with its customers, products and services. This positions us to better leverage our offerings to small businesses and execute on our strategy more effectively.”

“Given the size of the Yodle transaction, we planned for 2016 to be a significant transition year, and we believe this new structure sets the foundation for improved long-term revenue growth and financial strength. Generating strong free cash flow remains a priority for us, and we will continue to use our cash flow to pay down debt and repurchase shares in order to drive shareholder value.”

Brown also added that vertical market solutions and multi-location products present an attractive growth opportunity for the company going forward.

Jacksonville-based Web.com provides domains, hosting, web design and management, search engine optimization, and online marketing services to small and medium sized businesses.

Image: Web.com CEO David Brown via Web.com