Destiny Media Turns a Profit

Vandenberg comes through on his prediction of profitability, and the quarterly profit of $102,481 is almost seven times higher than my conservative, back-of-the-envelope estimate in the comments section of this post in April. From the company's press release:

Destiny Media Achieves First Operating Profit From Doubling of Play MPE(R) Revenues

VANCOUVER, British Columbia, July 14 /PRNewswire-FirstCall/ -- Destiny Media Technologies (OTC Bulletin Board: DSNY - News), the global leader in the secure distribution of pre-release music to radio and provider of instant play streaming media, is pleased to announce that third quarter revenues grew by 42% from the previous quarter (80% over the third quarter in fiscal 2008) on the strength of better than anticipated revenue for its Play MPE® system. During the quarter the Company became profitable and realized positive cash flow from operations. Play MPE® revenue grew by 114% from the same quarter in the prior year.

"The Company has 'crossed the chasm'^[1] into profitability and we expect revenues, income and positive cash flow to continue to grow into the foreseeable future", commented Destiny CFO, Fred Vandenberg. "We have experienced 17% compounded quarter over quarter revenue growth over the past eleven quarters which has resulted in income from operations. We project revenue to continue to rise in our fourth quarter leading to a conservatively estimated 30% increase in net income and to realize a profit for the year ended August 31, 2009."

According to Destiny CEO, Steve Vestergaard, "We have worked closely with the record labels to build a system that works well with their internal business processes and they are comfortable relying on our system as they phase out physical CD's completely. We expect our profits from Play MPE® business to grow into the foreseeable future as the labels expand usage internally and we expand internationally. In addition, we expect to layer in new revenue streams for Clipstream® products that will begin rolling out in Q1 of next year."

^[1]Here, Vandenberg appears to be alluding to Geoffrey Moore's bestseller on technology marketing, Crossing the Chasm. At the turn of the century, when I was a business development director for a financial/Internet start-up, the initial outside investor, a venture capitalist with a Harvard MBA and an undergrad engineering degree, recommended another of Moore's books to me, Inside the Tornado: Strategies for Developing, Leveraging, and Surviving Hypergrowth Markets. Can't say it offered any revelatory advice: our initial growth, such as it was, owed more to old-fashioned elbow grease and salesmanship than it did to any of Moore's ideas, but I do remember a humorous bit of self-deprecation in Moore's intro to the 1999 edition of his book, the first edition of which had been published in 1995:

According to the index, in the entire manuscript of Inside the Tornado the Internet is referenced precisely three times. How in the world did I completely miss what will arguably be the grandest tornado of all time? Well, all I can say is that it's a gift.