Online video platform Vimeo's revenue jumped 54 percent last year as its subscriber base surpassed 950,000, its parent group IAC said on Thursday.
The figures highlight the rising interest in alternate video platforms which are much smaller than market leader YouTube but are growing by serving a niche customer base.
Vimeo, founded in 2004, caters largely to business customers who pay anywhere from $84 to $900 (roughly Rs. 6,000 to Rs. 64,000) a year to upload and use professional tools to edit high-definition videos on its ad-free platform.
Its 2018 revenue of $160 million (roughly Rs. 1,100 crores) — disclosed for the first time by IAC — rose from $103.3 million in the previous year, while the number of paying subscribers climbed 9 percent year-over-year to about 952,000 by the end of December.
Although Vimeo's revenue is expected to rise "20 to 30 percent in the near-term," according to its Chief Executive Anjali Sud, the video service is far from making a profit as it burns cash on product development and aggressive marketing to popularize its brand.
"While Vimeo has high brand awareness in the U.S., people here and especially abroad aren't aware of the breadth of tools available on the platform," IAC's Chief Executive Officer Joey Levin said in a letter to shareholders.
Vimeo is projected to report an adjusted loss before interest, taxes, depreciation and amortization of between $35 million and $25 million in 2019, New York-headquartered IAC said.
"I absolutely believe (Vimeo) can be as big as Tinder," Sud said in an interview. "I very much believe there is plenty of opportunity for growth and all the signs that we see I think are proving that."
For the fourth quarter ended December 31, IAC reported overall revenue of $1.10 billion (roughly Rs. 7,800 crores), up by 16 percent from a year earlier and above Wall Street analysts' average expectation of $1.07 billion, according to IBES data from Refinitiv.
Net income surged to $191.8 million from $32.8 million a year earlier, benefiting from a more than $120 million pre-tax gain on the sale of Dictionary.com and other small businesses.
© Thomson Reuters 2019