Wizzard Software Announces 2nd Quarter 2010 Financial Results

PITTSBURGH--(BUSINESS WIRE)--Wizzard Software (NYSE Amex: WZE) announced second quarter 2010 financial results today, recording overall revenues of $1,318,989 in the second quarter of 2010, a 14% increase from revenues of $1,160,919 in the second quarter of 2009. The increase for the second quarter of 2010 reflects an increase in revenue in our media business of 8%, in our legacy speech business of 11% and in our legacy healthcare business of 17%.

“We have a total of 330 Apps with a lot more on the way and the world’s greatest media based marketing network for iTunes, iPhones, iPods and iPads, through which we promote these Apps”

In the second quarter of 2010, Wizzard achieved a gross profit of $448,629, an 18% increase from a gross profit in the second quarter of 2009 of $380,408. For the six months ending June 30, 2010, Wizzard posted a gross profit of $933,457 versus a gross profit of $754,689 in the first six months of 2009, an increase of 24%.

Operating expenses for the second quarter were down 7% from the second quarter of 2009. Wizzard’s loss from operations decreased in the second quarter of 2009 from $967,282 to $800,420 in the second quarter of 2010, a decrease of 17%. Including non-cash expenses, Wizzard’s net loss per share for the second quarter was $.02, a 48% decrease from our net loss of $.05 per share in the second quarter of 2009. In terms of net loss, this was Wizzard’s best quarterly performance in over 3 years.

Business Overview

For the second quarter of 2010, Wizzard Media, through its premier podcast-hosting service Libsyn, received 361 million download requests for podcast episodes with an average of 3.96 million episode requests per day. The number of podcasts on the Wizzard Media Network grew to 15,782, at the end of the second quarter 2010, an increase of 1,277 shows in the second quarter and a total increase of 2,319 shows for 2010. The total number of podcast episodes on the Wizzard Media Network increased to 1,016,545 currently available for audiences worldwide.

Gartner predicts that 21.6 Billion Apps will be sold/downloaded in 2013 worth $29.5 Billion. In mid-2009, Wizzard Media introduced a new monetization product for its podcast publishing customers with the launch of an iPhone podcast companion App. The podcast companion App for popular podcasts on the Wizzard Media Network offers audiences access to their favorite podcast directly on their iPhone, iPad or iPod Touch, bonus content and new social communication features such as Twitter and Facebook, creating an unprecedented level of audience entertainment and a new means to monetize podcasts. Podcasters and Wizzard earn revenue through the sale of the App as well as through in-App advertisements and in-App purchases of content, upgrades and subscriptions.

“We have a total of 330 Apps with a lot more on the way and the world’s greatest media based marketing network for iTunes, iPhones, iPods and iPads, through which we promote these Apps,” says Chris Spencer, Wizzard Media CEO. “We continue to see very positive trends with our podcast App business in terms of sell-through, early in-App purchasing numbers and growing demand for our podcast App product from podcast publishers. I believe we made tremendous progress on the execution of our podcast App strategy with the funding we obtained in the second quarter. The results of these efforts should be reflected in the second half of 2010.”

In the first two weeks of August, 2010, Wizzard completed its third phase of streamlining the internal automation process for creating podcast Apps. As a result, Wizzard submitted more Apps last week for approval to the App Store than in the entire previous month. Management reiterated its commitment to achieving 1,500 podcast Apps for sale in the App Store this year.

Additionally, Wizzard has acquired 15 popular iPhone Apps that it markets via advertisements on its podcast network taking the total number of all paid Wizzard Apps to 376 with 20 more in the approval process. Including free ‘lite’ versions of some of the acquired Apps, Wizzard has distributed over 3.2 million Apps to date. Wizzard is expanding its podcast App to work with Google Android and Blackberry platforms in 2010, which should provide for substantial revenue growth opportunities as the podcast App is introduced to an entirely new user base.

In the first quarter of 2010, Wizzard launched In-App Advertising technology for its podcast Apps as well as In-App Purchasing technology allowing for content sales, upgrade offerings and monthly subscription revenue models. While early, initial revenue numbers show subscription revenue tracking higher than originally expected with 5.5% of users opting to pay for on-going subscriptions or monthly premium upgrades. Surprisingly, users are opting for 12 month subscriptions/upgrades over 1 or 6 month subscriptions/upgrades by a 2.5 to 1 ratio and 4 to 1 ratio respectively.

Wizzard executed multiple national brand advertising campaigns for companies including JC Penny, Merit Financial and Audible in the second quarter of 2010, delivering 19.8 million ads vs. 15.5 million ads delivered in the second quarter of 2009. (Numbers do not include in-App advertisements at this time.)

2^nd Quarter and Subsequent Business Highlights:

April 1				Wizzard Secures $2.0 million in Equity Financing
April 21				Wizzard Surpasses 200 Podcast Apps In App Store
April 27				Wizzard Launches Vatican Observatory iPhone App on Easter Sunday
May 5				Wizzard’s Gossip Junkie HD Top Paid Celebrity Gossip App for iPad
May 27				Wizzard Media Network Reaches 15,000 Podcast Show Milestone
June 8				Google Adds Wizzard Media iPhone Apps to Search Results
June 30				Wizzard Market Expands With iTunes Reaching 67 New Countries
July 14				Wizzard Media’s Podcast Apps Approved with Apple’s iAds
July 20				Adam Carolla Selects Wizzard Media for Hosting and Monetization
August 5				Joe Rogan Chooses Wizzard Media’s Libsyn Pro Podcasting Service
August 11				Wizzard Media In Agreement with RIM’s BlackBerry Podcast Service
August 16				Wizzard Announces 15,782 Shows and 376 Total Paid iPhone Apps

Industry Related Highlights Effecting Wizzard’s Media Business:

Apple Launches iPad; Sells Approx 5 million to date

Apple Launches iOS 4.0 Update for legacy iPhones

Apple Launches iPhone 4; Sells 3 million in first 3 weeks

Apple Launches iAds

Google Begins Indexing iPhone App Purchase Pages for Search Results

Apple’s iTunes Expands Podcasting Store to 90 Countries

RIM Launches BlackBerry Podcasts Service

The previously mentioned numbers and statements are highlights from Wizzard’s 2010 2nd Quarter 10Q filing. For a complete and detailed financial description of Wizzard Software Corporation, please visit www.sec.gov, where all of Wizzard’s SEC filings can be found.

iPod, iPad, iPod Touch, iPhone and iTunes are all registered marks or trade names of Apple, Inc. BlackBerry and BlackBerry Podcasts Service are registered marks of Research in Motion. Google is a registered mark of Google.

About Wizzard Software

Through its Media business segment, Wizzard Media provides podcast publishers with distribution and monetization services. Our clients include Microsoft, National Geographic, Harvard Business Review, Usher, NPR and more than 15,000 others who use Wizzard Media products to measure their podcast audience, deliver popular audio and video entertainment and monetize their content through advertising and App sales. In 2009, the Wizzard Media Network received over 1.4 billion podcast requests from approximately 50 million people worldwide through iPods, iPhones, iTunes, Zunes, BlackBerrys and many other devices and destinations. Wizzard Media is part of a publicly-held, Pittsburgh based company with Software and Healthcare business segments, thousands of shareholders and a world-class team. Visit us on the web at www.wizzardsoftware.com/media, email us at contact@wizzard.tv.

Legal Notice

Legal Notice Regarding Forward-Looking Statements: "Forward-looking Statements" as defined in the Private Securities litigation Reform Act of 1995 may be included in this news release. These statements relate to future events or our future financial performance. These statements are only predictions and may differ materially from actual future results or events. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments or otherwise. There are important risk factors that could cause actual results to differ from those contained in forward-looking statements, including, but not limited to risks associated with changes in general economic and business conditions, actions of our competitors, the extent to which we are able to develop new services and markets for our services, the time and expense involved in such development activities, the level of demand and market acceptance of our services, changes in our business strategies and acts of terror against the United States.