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Stamps.com undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.Now, I’ll hand the call over to Ken. Ken McBride Thank you Jeff and thank you for joining us today. Today, we announce another great quarter where we had strong financial performance and where we again had outstanding performance in multiple areas of the business. We achieved a sequential quarterly increase in our paid customers which were up 5,000 to a new all-time record high level of 418,000. Our year-over-year growth rate for paid customers was 14%, which is the highest growth rate in four years for the seasonally slower second quarter. We achieved the highest growth rate for enterprise paid customers in five years. We continued our strong momentum in our high volume shipping area with 80% growth in total postage printed. We achieved a record growth rate for total postage printed by our customer base which is up 53% to a new record level of $233 million. And we achieved record core PC Postage revenue with 18% year-over-year growth and continuing the strong double-digit growth rates we’ve experienced over the past seven quarters. The strength we saw across the board in our business lines drove strong earnings in the second quarter with record non-GAAP operating income of $6.8 million, record non-GAAP net income of $6.9 million and non-GAAP earnings per share of $0.40. During the second quarter of 2011, we first applied breakage accounting to our PhotoStamps boxes sold through retail channels and this added $2.2 million to PhotoStamps revenue, $1.7 million to non-GAAP operating and net income and $0.12 to non-GAAP net income for fully diluted share. We believe the growth rate excluding the initial recognition of PhotoStamps breakages in the second quarter of 2011 provides a more meaningful comparison of the year-over-year performance.
Excluding the initial recognition of PhotoStamps retail box breakage in 2011, total revenue in the second quarter of 2012 was up 15% year-over-year, non-GAAP net income was up 45% year-over-year; non-GAAP net income for fully diluted share was up 21% year-over-year.While we face very tough comparisons during the second quarter this year, we were pleased that the business continued strong growth trends particularly in light of the fact that the small business economic environment continues to struggle relative to pre-recession levels. On the call today, we’ll talk in more detail about our PC Postage metrics and business, our financial results and our business outlook. First, let me begin with a more detailed discussion of the PC Postage business. The customer metrics we’re going to discuss on the call today are only for the core PC Postage business which excludes all enhanced promotion channel activity. For more detailed definition of how we calculate each of our metrics, you may refer to our quarterly investor metric spreadsheet at investor.stamps.com. Core PC Postage revenue including small business enterprise and high volume shipping customer segments was $26.2 million in the second quarter. That was up 18% versus the second quarter of 2011. Over the past seven quarters, we have generated strong double-digit year-over-year growth rates in our core PC Postage revenue. This Q2 released the highest quarterly revenue level we have experienced in our core PC Postage business since we started tracking the core areas approximately six years ago. The increase in the core PC Postage revenue was attributable to continued strength in our small business area and in our enterprise and high volume shipping customer segments which are now contributing to our core business revenue growth in a meaningful way. During the second quarter, we acquired 71,000 gross small business customers; that was up 12% versus the second quarter of 2011 and our cost per new small business customer acquired or CPA was $125 in the second quarter; that was up 1% versus the $124 we saw in the second quarter of 2011. Read the rest of this transcript for free on seekingalpha.com