Re: article: INSP Renewing (part 2)
by: cabvineyard (M/Connecticut)
Long-Term Sentiment: Strong Buy 12/13/01 04:11 pm
Msg: 330031 of 330182
InfoSpace is poised to capitalize on that by offering new services in the short messaging service, or SMS, category. These include services such as SMS sports alerts and e-mail messages.
"In Europe, 20% to 25% of all wireless revenue comes from SMS service," Jain said. "This is tremendously important for carriers in the U.S."
Good Growth Seen In Merchant Services
On the merchant services side of its business, InfoSpace is seeing good growth from its Authorize.Net payment platform, Jain said. Big banks, such as Wells Fargo and Union Bank of California, have recently signed on to offer electronic payment under their own name using InfoSpace technology. Merchants can also use the service directly.
Authorize.Net helped process $700 million in purchases in the third quarter, up from $600 million in the second quarter. InfoSpace gets a cut of each dollar processed.
"That has been growing quarter-over-quarter for the last six quarters and we feel very good about this quarter," Jain said, adding that he hopes merchant service revenue will grow at a rate higher than 15% going forward.
In its wireline business, InfoSpace got approval from the U.S. Bankruptcy Court on Nov. 28 to buy certain Excite.com media assets, including domain names, trademarks and user traffic associated with the Web site.
"Wireline is showing good growth, and search and directory use are both tracking very well," Jain said.
Jain said InfoSpace is looking to acquire more assets of failed dot-com companies if they become available.
Jain said he's comfortable with estimates the company will lose a mean of 8 cents a year on an operating basis. He said he believes the company will return to profitability on a pro forma basis in the second half of 2002.
Like many companies in the Internet sector, InfoSpace has been losing a lot of money on a net basis. In 2000, InfoSpace lost $282.41 million, or 93 cents a diluted share, on revenue of $214.5 million.
Jain said he couldn't predict when the company would be profitable on a net basis, due to such factors as acquisitions and changes in how the Securities and Exchange Commission wants companies to account for goodwill.
-By Paula L. Stepankowsky, Dow Jones Newswires; 360-636-2008; paula.stepankowsky@dowjones.com
(This story was originally published by Dow Jones Newswires)
Copyright (c) 2001 Dow Jones & Company, Inc.
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