Just two years after it went public at $10 a share, FriendFinder Networks, publisher of Penthouse, filed for Chapter 11 bankruptcy yesterday.
The bankruptcy petition cites up to $1 billion in debt and less than $10 million in assets.
39 other related companies filed for bankruptcy.
The company and its affiliates comprise a global network of more than 8,000 websites with 220 million members and 750,000 subscribers, according to court documents.
FriendFinder has only generated $300 million in revenue last year, but hasn’t turned a net profit since 2008.
The company blamed a decline in membership and increasing affiliate fees.
It also stated that some credit card companies aren’t processing payments made on the site without giving them a reason.
The company will reorganize its debts.
Shares in the company last traded under its FFN symbol on August 7th at $.43 cents a share when it was de-listed from the NASDAQ, yesterday shares of the company basically went to zero on the pink sheets (OTCMKTS:FFNT) after investors found out that the company would no longer be a public company after the bankruptcy.