Vonage Holdings Corp.'s market debut on Wednesday got a cold shoulder from Wall Street, as the Internet telephony company posted the worst first-day performance in two years.
The Holmdel, N.J., company launched on Tuesday its initial public offering, which set the share price at $17 at the market opening. Despite inching up 25 cents for a time, Vonage stock finished the day at $14.85, a 12.6 percent drop from the IPO price.
Vonage's debut was the worst since nanotechnology company Lumera Corp., which lost 13.5 percent during its first day of trading in July 2004, The Wall Street Journal reported.
Vonage raised $531 million in its IPO, which it filed with the Securities and Exchange Commission in February. The company at the time said it needed the money for expanding its business and to fund marketing and operating losses.
Vonage's strategy has been to trade profits for heavy spending on marketing to increase its customer base, which has reached 1.4 million subscriber lines. In the first three quarters of 2005, the company lost $189.6 million, while spending $176.3 million on marketing, according to SEC filings. The company remains unprofitable today.
Subsea cable alternatives can provide a level of comfort for those concerned about disruptions. Realistically, they will continue to play a small, but critical role in the short term.
Maintaining existing network infrastructures often incurs huge technical debt before newer technologies are adopted over time.
Amid ongoing regional uncertainties, telecom infrastructure in the Middle East has expand to include terrestrial low-latency network infrastructure, which offers resilience and agility in navigating political complexities without relying solely on undersea networks.
