DoubleClick Reports First-Quarter Loss
By Andrea Orr
PALO ALTO, Calif. (Reuters) - Internet marketing company DoubleClick Inc. (NasdaqNM:DCLK - news) on Thursday reported a first-quarter net loss but surprised Wall Street by showing an operating profit even as revenues fell, reflecting aggressive cost cutting.
DoubleClick also reduced revenue guidance for the second quarter and cautioned that the online advertising business had not yet shown signs of recovery.
DoubleClick reported a first quarter net loss of $6 million, or 4 cents a share, compared with a loss of $60.4 million, or 48 cents a share, last year.
On an operating basis, excluding unusual items, the company said it earned a profit of $1.4 million, or 1 cent a share, compared with an operating loss in the year-ago quarter of $10.5 million, or 8 cents a share.
The results surpassed the forecasts of most analysts, who on average had been expecting an operating loss of 4 cents a share. But analysts stressed that it was cost savings and not revenue growth that produced the surprise.
``It was really encouraging that they were able to cut costs, but the revenue is not there,'' said U.S. Bancorp Piper Jaffray analyst Safa Rashtchy. ``Investors don't care much about profitability that is due to cutting expenses.
DoubleClick said revenue fell to $83.7 million from $114.9 million in the year-ago period, and said it expects to report second-quarter revenue of between $77 million and $82 million, compared to analysts' forecast for revenue of $89.9 million.
Chief Executive Kevin Ryan highlighted other concerns during a conference call with analysts, saying that the email marketing business, one of its most promising units, was feeling pricing pressures. In addition, he said, DoubleClick was under pressure to develop new products and make more acquisitions in order to stay on track.
DoubleClick's stock, which had closed the regular trading session down $1.18 to $9.98 a share, was quoted about 5 cents higher in after-hours activity, following the release of earnings. The stock is down about 14 percent year-to-date, about in line with the stock movement of Internet media giant Yahoo! Inc (NasdaqNM:YHOO - news) so far this year.
DoubleClick also said its operating results in the second quarter should be between a loss of a penny and a profit of a penny per share, in line with analyst forecasts for a break-even quarter. |
