NEW YORK (CBS.MW) -- With CMGI in the spotlight of Internet
news, its release of strong quarterly earnings Thursday couldn't
be more timely due to questions about the company's
involvement with Lycos.
After the close Thursday, CMGI reported net
income of $14 million, or 30 cents a share,
which includes gains from the sale of
investments in Lycos, Amazon.com (AMZN)
and GeoCities (GCTY). The quarterly net
compares to a 15 cent loss in the year-ago
period and beat consensus estimates of a
22 cent loss.
But a seemingly blowout quarter it's not. To
be fair, analysts don't know when CMGI will
book gains on stock sales, making
predictions very difficult, said Chuck Hill,
director of research at First Call.
Beyond quarterly earnings, further questions
remain about the company's direction. A
company conference call will give analysts an
opportunity to grill CMGI (CMGI) chief
executive David Wetherell about his
intentions with Lycos (LCOS).
Ken Winston, Internet analyst at Needham &
Company, said he's more interested in learning about the
company's "strategic development of its businesses and how
quickly they're winning contracts."
Winston also said he'd like to hear more word about what's likely
to happen with Lycos. But he doesn't believe CMGI would buy
Lycos because it would be a departure from the company's
strategy of investing in and building up start-up Net companies.
CMGI posted $39 million in revenue, up 178 percent from a year
ago. But that was slightly below the First Call consensus
estimate of $42 million.
In after-market trading on Instinet, shares of CMGI stood
relatively unchanged at 182. Shares fell 9 9/16, or 5 percent, to
182 1/8 during regular trade Thursday.
Bambi Francisco is the Internet editor for CBS MarketWatch.
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