The content delivery business continues to be a disappointment for Internap Network Services Corp. (Nasdaq: INAP), which saw sales in its CDN segment decline for the third straight quarter.
Last week, Internap reported that third-quarter revenues increased 8 percent to $65.4 million. But while the company showed continued growth in its data center and IP transit businesses, CDN sales in the quarter dropped to $5 million, down from $5.4 million in the second quarter and $5.6 million in the third quarter 2007.
The decline in Internap’s CDN sales surely comes as a disappointment, considering the $217 million it paid for the assets of VitalStream to enter the business more than a year and a half ago. Internap wrote down the goodwill value of that acquisition by nearly $100 million ahead last week’s financial report, and took a $102 million charge against its earnings.