WALTHAM, Mass.--(BUSINESS WIRE)--Nov. 19, 1998--
51% Sequential Growth in Quarterly Traffic
30% Increase in Revenues from Previous Quarter
Lycos Network Reach Grows to 44.5%
Lycos, Inc. (NASDAQ:LCOS), the second most popular hub on the
Internet and largest online community, today announced financial
results for its first quarter ended October 31, 1998. Revenues for the
quarter were $24.8 million, representing an increase of 30% over the
previous quarter ended July 31, 1998 and a 166% increase over the
comparable period from the previous fiscal year. The Company reported
a loss of $2.6 million or $0.06 per share for the quarter before
amortization, one-time merger-related expenses and gain on sale of
equity securities. This compares to a net loss of $1.6 million or
$0.04 per share for the previous quarter ended July 31, 1998. Net loss
per share for the quarter ended October 31, 1998 after amortization
and one-time charges was $0.35.
"Once again Lycos far exceeded Wall Street's estimates of every
key metric. This quarter's explosive growth in revenue, reach and
traffic reaffirms the strength of the Lycos Network business model,"
said Edward M. Philip, Lycos' Chief Operating Officer and Chief
Financial Officer. "Our strong operating results this quarter are
evidence of our ability to quickly integrate acquisitions, monetize
traffic and create operating efficiencies throughout the Lycos
Network."
During this quarter, Lycos unveiled the Lycos Network, which
fortifies our position as a premier media company. The Lycos Network
combines diversity of programming with mass audience reach - a
business model for continued expansive growth. Consumers get access to
tailored programming while advertisers and commerce partners have
access to a large audience with unparalleled market segmentation. The
Lycos Network provides the Company cost efficiencies in
infrastructure, operations and distribution. With its unduplicated
reach of 44.5% of Web users or 27.8 million unique visitors in October
(see separate release issued earlier today), the Lycos Network has
strengthened its position as the Web's second most visited hub or
portal. Usage of the Lycos Network grew 51% to 36 million page views
per day in October, up from 24 million page views per day in July.
"We are extremely pleased with the progress we made this quarter
toward our mission of becoming the world's most visited online
destination," said Robert J. Davis, President and CEO of Lycos.
"Through a combination of internal growth and a series of strategic
acquisitions, we have created a network of properties that gives
Internet users a wider choice of content, offers advertisers
unprecedented targeting and reach and leverages the cost efficiencies
of our infrastructure. Lycos has become the world's fastest growing
Web network and with our tremendous momentum, we are excited about the
opportunities that lie ahead."
Key accomplishments for the quarter:
Acquisitions
-- Lycos acquired WhoWhere?, which offers a complete line of
Web-based applications, including its leading directory services,
popular e-mail service and Angelfire, a leading Web community.
With Angelfire, Tripod and Guestworld, Lycos owns the Web's
largest community with over 5 million registered members.
-- Lycos signed a definitive agreement to acquire Wired Digital,
home of one of the strongest brands and innovative families of
products and services on the Web, including HotBot, HotWired,
Wired News, WebMonkey, Suck.com and Web 101.
E-commerce and Advertising
-- Lycos signed a $22.5 million agreement with Fleet Bank, which,
among other initiatives, allows consumers to apply for a
no-annual-fee credit card bearing the Lycos brand. This
partnership enables Lycos to extend its relationship with members
and consumers with a Lycos-branded credit card. Fleet Bank will
also promote Lycos services to Fleet's existing card members.
-- Lycos introduced AuctionConnect, a unique shopping service that
allows Internet shoppers to get the best deals by searching
multiple auction sites for a particular product. The DealWatch
feature of AuctionConnect allows users to receive automatic,
personal notifications when specific items are available for
auction. Lycos also has the exclusive right to use the Bidder's
Edge proprietary technology for the service.
-- During the quarter, Lycos also entered into agreements with
Boston.com, CareerPath.com, iVillage and Microsurf.
Product Enhancements
-- Each of the Lycos Network sites has been redesigned to allow for
easy navigation amongst Lycos Network properties and to provide
users easy access to a multitude of services and content.
-- Lycos launched the redesigned Lycos.com making it faster and
easier for users to navigate the Internet and find what they
need. Influenced by extensive market research, Lycos.com's
interface and navigation features are designed to give users the
most precise and relevant information at all times. As a direct
result of these enhancements, Lycos was recently ranked as the
second fastest website by Keynote Systems.
-- Tripod, a Lycos subsidiary and leading community site, launched a
redesign of the www.tripod.com site with improved navigation,
functionality, organization and a fresh new look. The new design,
based heavily on feedback from Tripod's over 2 million members,
fully integrates the Lycos search technology and divides the site
into sections centered around activities that members engage in
most: Build, Explore, Interact, and Buy/Sell.
Strategic Milestones
-- Through the combination of internal growth and strategic
acquisitions, Lycos leapfrogged several other sites to become the
second most popular hub on the Internet in terms of audience
reach and unique users.
-- Lycos announced the "Go Get It" national advertising campaign
aimed at getting new and experienced Internet users to visit the
Lycos Network. Lycos, Your Personal Internet Guide, is
represented in the campaign by "Lycos," a retriever who quickly
and easily locates information on the Web. This broad-reaching
campaign is national in scope with additional concentration in 11
high-indexing Internet markets.
-- In August, Lycos was issued a Notice of Allowance for a patent
application that was filed by WiseWire Corporation prior to
Lycos' acquisition of WiseWire in April. The WiseWire technology
gives Lycos highly effective directory-building and enhanced
search capabilities.
Forward-looking statements in this release are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Investors are cautioned that all forward-looking
statements involve risks and uncertainties, including, without
limitation to, the level of usage of the Internet and traffic to the
Company's Internet site, continued acceptance of the Company's
products, demand for Internet advertising, seasonal trends in
advertising sales, the advertising budgeting cycles of individual
advertisers, capital expenditures and other costs relating to the
expansion of operations, the introduction of new products or services
by the Company or its competitors, the mix of the services sold and
the channels through which those services are sold, pricing changes,
general economic conditions and specific economic conditions in the
Internet industry and other risks detailed in the Company's filings
with the Securities and Exchange Commission.
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