Carbonite CEO: Dropping Rush Limbaugh Hurt Revenue More than Expected
When Media Matters helped organize the Stop Rush boycott pressuring corporations to pull advertisements from Rush Limbaugh’s show, the online file storage company Carbonite was one of the first big names to give in.
Now, as William Jacobson of the “Legal Insurrection” blog noted, Carbonite’s CEO David Friend conceded on a conference call that dropping Limbaugh deeply hurt the company’s earnings.
“It turned out to be a bigger hole in our revenue than we had thought when we initially did this,” Friend said on a conference call on August 1.
In fact, as Jacobson wrote, Carbonite’s 2nd Quarter 2012 results shocked analysts, causing the company's stock price to plummet by 15% in one day.
Jacobson transcribed the relevant portions of the conference call where Friend said four factors contributed to the company’s slow growth, and the first factor was that Carbonite “stopped working with one of our top producing radio endorsers,” which was Rush Limbaugh.
A questioner on the call then told Friend that he was “a little surprised that you were caught by surprise by the radio host change ’cause I know we’ve talked and I guess my impression was that it wouldn’t be that impactful but I guess it was quite impactful.”
Friend responded, “Yeah, I’d say it turned out to be a bigger issue than we had anticipated.”
Friend then, perhaps realizing he made a so-called Kinsley gaffe, said he was not regretful of the decision to drop Limbaugh and then tried to spin away his previous statements, saying, “things would have been worse” had Carbonite not pulled their advertisements from Limbaugh’s show.