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Revenue at embattled Pacific WebWorks dropped 88 percent in the third quarter from the previous year.
Sales at the Salt Lake City software company began to fall after it was sued in December 2009 by Google, which alleged the Utah company was behind a scheme that used websites to tout work-at-home opportunities that falsely traded on Google's name. Once consumers signed up for "Google products" for a nominal fee, Pacific WebWorks used the same credit or debit cards to charge them as much as $79.99 a month for other services, which often turned out to be worthless, according to the lawsuit.
The two companies settled in June, with Pacific WebWorks agreeing to a permanent injunction prohibiting it from misusing Google's name when it markets its software for doing business on the Internet and with other products.
Since then, Pacific WebWorks' revenue has been in free fall. In August, it reported second-quarter revenue of $3.3 million, which declined to $1.08 million in the third quarter that ended Sept. 30, according to a Securities and Exchange Commission filing this week. In the third quarter 2009, its revenue was$9.68 million.
Despite the sharp revenue decline, Pacific WebWorks said it still had net income of $149,435, compared with$1 million in the same quarter of 2009.
For the nine months that ended Sept. 30, the company reported revenue of $8 million, down from $21.6 million for the same period of 2009. Net income for the first nine months of this year was $1.12 million, compared with $1.36 million for the same period of 2009.
Pacific WebWorks continues to blame its woes on "abuses in our affiliate marketing system" outside companies with which it had contracted to create websites and advertising material directing potential customers to the Utah company's products.
But the company still faces at least six lawsuits alleging it actively participated in defrauding customers.
The company said it anticipated continued profitability, with growth beyond 2010 from 10 percent to 20 percent as its ramps up marketing efforts. Pacific WebWorks said it also is seeking opportunities for mergers or acquisitions.
Its over-the-counter shares finished the day Wednesday unchanged at 11 cents.