Penny Stock "Bounce Watch" for October 12th, 2010

VIDAROO CORPORATION (OTCBB: VIDA) $.055

Friday’s news:

Photo Release — Vidaroo Corporation Selected for Video Production by Feld Entertainment for Its Newest Production, Disney On Ice Presents Disney*Pixar’s, Toy Story 3!

ORLANDO, Fla., Oct 8, 2010 (GlobeNewswire via COMTEX) — Vidaroo (OTCBB:VIDA) today announced the winnings of 2 production assignments with Feld Entertainment: Disney On Ice presents Disney*Pixar’s Toy Story 3 and Disney Live! Mickey’s Music Festival. Vidaroo’s services included rendering 2-D and 3-D creative graphics for projection in synchronization with the live show.

A photo accompanying this release is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8133

“We’ve been in the business of making content for a long time now,” states Ian McDaniel, Vidaroo’s Production President, “but we’ve never been confronted with the challenge of making that content look good when projected on ice. We spent many weeks on-location to create content for a show that children and adults alike will love! Working with the team at Feld Entertainment was an absolute pleasure.”

The significance of Vidaroo and Feld coming together, on the video front to produce shows, certainly holds a lot of possibilities for audiences to be delighted and a bright outlook for both companies futures.

“If you don’t know who Feld Entertainment is and why we are so excited to have them as a client, you should, as they have been capturing the hearts of audiences in over 70 countries and on six continents since the company’s inception in 1967, a feat that makes Feld Entertainment(R) the largest provider of live family entertainment in the world,” states Mark Argenti CEO, Vidaroo.

Stock:

Number of shares of common stock outstanding as of September 15, 2010 was 65,136,032

Revenues

Revenues increased by $214,881 to $1,312,919 or 20% for the year ended June 30, 2010. The portion of revenues derived from licensing and advertising increased by 9% while production revenue increased by 23%

Cost of Sales

Costs of sales decreased by $138,856 to $351,384 for the year ended June 30, 2010. Cost of Sales consists of variable costs for incremental expenses beyond the Entity’s established infrastructure. Costs associated with delivering digital video such as bandwidth, personnel and commissions of approximately 30% were charged for licensing and advertising. Costs associated with the delivery of video production support include rental equipment, facility charges, personnel and third party graphics were approximately 19% of revenue.

Operating Margin

Operating margin increased by $353,737 to $961,535 in the year ended June 30, 2010. Operating margin as a percentage of sales increased to 73% in the year ended June 30, 2010 from 55% in the year ended June 30, 2009. The increase in operating margin percentage was due to lower cost structure associated with the type of production revenue received in the year ended June 30, 2010. The production services provided in the year ended June30, 2010 had a higher operating margin percentage due to the nature of expenses incurred to procure equipment and facilities needed to implement the entertainment engagements in large venues served by our clients.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of salary wages and benefits, and professional services.

Selling, general and administrative expenses decreased by $603,911 to $1,804,077 for the year ended June 30, 2010 from $2,407,988 for the year ended June 30, 2009. The decrease was due to the reduction of salaries associated with the Executive Management team’s compensation and a reduction of resources required for external professional service firms.

Small “bottle-neck”:

Recent Issuances of Stock

During the year ended June 30, 2010, the Entity issued a total of 6,960,841 shares of common stock. 3,029,038 shares were issued in satisfaction of options and warrants exercised, for consideration of $149,143; 2,434,465 were issued as Stock based compensation for employees valued at $887,795; 900,000 were issued directly to investors for consideration of $180,000;

539,338 were issued for professional services for consideration valued at $378,694; and 58,000 valued at $8,932 were issued in conjunction with the extension of the terms of Convertible Promissory Notes Payable.

During the year ended June 30, 2009, the Entity issued a total of 12,980,191 shares of common stock. 8,950,522 shares were issued in satisfaction of options and warrants exercised, for consideration of $368,587; 3,624,007 were issued in satisfaction of debt obligations for consideration of $337,401; 25,000 were issued directly to investors for consideration of $6,500; and

380,662 were issued for professional services for consideration valued at $353,305.

Happy Trading!

VIDA, VIDAROO CORPORATION

Penny Stock “Bounce Watch” for October 12th, 2010

Financial Network