InPhonic plan for growth connects

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Analysts are optimistic about InPhonic Inc.'s new business plan and see big potential for the D.C. wireless services company.

The Georgetown-based firm sells wireless telecommunications service, wireless phones and accessories over the Internet. Customers can purchase wireless service and products from InPhonic's retail Web sites such as Wirefly.com, A1Wireless.com and VMCSatellite.com.

Practically all of the company's revenue comes from its wireless sales and activation business, and the remainder comes from its satellite services business.

The company has 475 employees, offices in the District, Largo and Reston, and partnerships with Amazon.com, Staples.com and AOL.com. Its main competitors are large retail chains such as Wal-Mart and Radio Shack.

"We're quite nimble ... because we don't have thousands of brick-and-mortar stores to worry about," said InPhonic spokesman Tripp Donnelly.

InPhonic officials project a 25 percent increase in growth this year over 2006. Revenue jumped to $120.3 million for the fourth quarter of 2006 compared with $85.2 million the previous year. Net loss for 2006 fell 87 percent to $3.5 million compared with $24.6 million the previous year.

Shares of InPhonic fell 46 cents yesterday and closed at $12.79 on the Nasdaq Stock Market.

"InPhonic is moving to the point where they could see profits in the next year," said David Coleman, an analyst for the Argus Research Group, a New York equity research firm.

InPhonic has grown over the past three years by increasing its partnerships with wireless communications carriers from three to five. The top six domestic wireless carriers are Sprint/Nextel, T-Mobile, AT&T/Cingular, Verizon, Alltel and Qwest Communications.

"Our business model has changed dramatically, said Chief Executive Officer David Steinberg. "We should be seeing an acceleration off our customer base growth." Mr. Steinberg said InPhonic has 7.5 million to 8 million customers.