Stamps.com Inc. Revenue Surges 74%

By Markets Fool.com

Image source: Stamps.com.

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Stamps.com (NASDAQ: STMP) saw its sales and profits soar in the second quarter, leading the provider of internet-based postage and shipping services to once again boost its revenue and earnings outlook for the year ahead.

Stamps.com results: The raw numbers

Metric

Q2 2016

Q2 2015

Growth (YOY)

Revenue

$84.013 million

$48.360 million

74%

Net income

$14.291 million

($10.431 million)

N/A

Earnings per share

$0.79

($0.64)

N/A

Data source: Stamps.com Q2 2016 earnings press release.

What happened with Stamps.com this quarter?

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Total revenue soared 74% year over year, to $84 million, with mailing and shipping revenue leaping 72%, to $81.5 million, and customized postage revenue surging 130%, to $2.5 million.

Helping drive those results was a 14% year-over-year increase in paid customers, to 646,000, and a 51% rise in monthly average revenue per unit (ARPU), to $42.06. In addition, total postage printed in Q2 was $1.17 billion, a 114% increase from the prior-year quarter.

Stamps.com also continues to improve its profitability, with total gross margin rising to 83.7% from 79.5% in the second quarter of 2015.

That helped EBITDA (earnings before interest, taxes, depreciation, and amortization) -- adjusted to exclude stock-based compensation expense, acquisition-related charges, and certain other items -- jump 116%, to $38.2 million. And adjusted (non-GAAP) operating income was$37.1 millionin the first quarter, a 121% increase from the year-ago period.

All told, non-GAAP net income surged 111% year over year, to $35.3 million, and non-GAAP EPS leaped 100%, to $1.94.

Looking forward

Those strong first-quarter results encouraged Stamps.com to raise its sales and profit outlook for 2016. The company now expects full-year revenue to be between $320million and $345 million, up from its prior forecast of $310million to$330 million issued in May, and guidance for $290 million to $310 milliongiven in February.

The company also boosted its profit outlook, and now projects non-GAAP earnings per share to be in a range of$7.00to$7.50, up from previous estimates of $6.00to$6.50 given in May, and $5.00to$5.50 in February.

"Our investments across all our companies in the areas of sales and marketing, customer service, product development and technology innovation have led to growth in packages shipped by our customers, which in turn have contributed to our great financial performance," said the company's chairman and CEO, Ken McBride, in a press release. "Based on our outstanding results and the continued strength in our businesses, we increased our 2016 guidance today."

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Joe Tenebruso has no position in any stocks mentioned. The Motley Fool recommends Stamps.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.