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December 22, 2003

GoAmerica Snags Financing, Refocuses

From: Wireless Week - Dec 22, 2003

By Susan Rush
December 22, 2003
news@2 direct

GoAmerica Inc. has secured $14.5 million in financing. Along with the financing news, the company said it plans to focus its efforts on its Wynd Communications subsidiary while still holding on to Go.Web.

GoAmerica has been working to revitalize its financials for more than a year now. In July, the company said it was considering shedding one of its subsidiaries, either Wynd or Go.Web. While many speculated that Go.Web would be the entity to be cut loose, GoAmerica has announced it is keeping both.

The $14.5 million in financing, a private placement offering, will mostly be used to pump up services offered by Wynd, a provider of wireless services to people who are deaf or hard of hearing. Right now, Wynd has roughly 14,000 customers, but GoAmerica says according to industry research, there are 28 million people who are deaf or hard of hearing in the United States. The company plans to develop enhancements to its communication technology and roll out a new market initiative.

GoAmerica decided to stop trying to sell Go.Web because after analysis of offers received, the company decided it could garner more revenue from the subsidiary by keeping it.

As part of the financing package announcement, GoAmerica updated its financial forecast. The company expects to end fiscal 2003 with $12 million in revenue. The company also expects to record operating losses and one-time charges associated with restructuring, although no specifics were provided.

Looking ahead to 2004, GoAmerica expects to generate revenue between $12 million and $13 million and is hopeful it can achieve profitability in the fourth quarter.

Revenue from Go.Web is expected to dip 30 percent this year and then falter 14 percent and 4 percent in 2004 and 2005, respectively, the company says.

c 2003 Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.