Revenue
Revenue for the quarter ended January 31, 2014, increased $776,000 to $1.3 million, or 142%, from $547,000 for the corresponding period of 2013.
In Brazil, our network revenue was $166,000 during the quarter ended January 31, 2014, and $118,000 for the same period of 2013, an increase of $48,000.
We recognize our network revenue in Brazil on a net basis since we do not maintain inventory for our virtual prepaid mobile top-up products. If we recognized the revenue on a gross basis, the revenue recorded would have been $8.1 million and $3.8 million for the quarters ended January 31, 2014 and 2013, respectively, a 113% increase. The increase in revenue is primarily attributed to the increased number of transacting terminals and the increase in the average number of transactions per terminal.
Hardcard revenue in Brazil increased by $156,000 from nil in the first quarter of 2013 to $156,000 in first quarter of 2014. The increase is due to new sales offices that have been set up to sell scratch cards in northern regions of Brazil.
Hardware sales in Brazil increased by $506,000 from $47,000 in the first quarter of 2013 to $553,000 in first quarter of 2014, a 1,073% increase. The increase is related to increased sales of SIM cards in Brazil as well as commissions the Company receives from a major telecom supplier for activations of these SIM cards.
Our software and related service revenue increased by $67,000, or 17.5%, to $448,000 for the first quarter of 2014 compared to $382,000 for the same period in 2013.This increase was primarily due to recognition of the Company’s license and services agreement in the United Kingdom.
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With its major recent contracts/ JV deals yet to kick in, VSI is going to show scorching revenue growth for all of the remaining quarters if this year and probably next, as more deals are expected to be announced this year .