Revenue warning sends TheStreet.com shares lower
Shares of online financial news provider TheStreet.com fall in after-hours trading after the company announces that third-quarter revenue will be lower than expected.
The company gave no exact revenue forecast in a statement issued after the close of regular trading. However, TheStreet.com did say that per-share earnings for the quarter will meet analysts' forecasts.
Wall Street expects the company to post a loss of 37 cents a share, the consensus estimate of seven analysts surveyed by First Call/Thomson Financial. The company lost 29 cents a share during last year's third quarter.
A First Call revenue estimate was not available. But in a research note dated July 31, Jefferies & Company analyst Michael Legg said he expects revenue of $8.1 million for the third quarter. In the second quarter, TheStreet.com reported revenue of $7 million.
In after-hours trading, the company's shares fell 88 cents, or 14 percent, to $5.25. During regular trading hours, the shares rose 9 cents to $6.13. TheStreet.com's shares have fallen 68 percent this year, trading within a range of $4.68 to $27.25.
"From a revenue standpoint, this is a disappointing quarter for TheStreet.com," said CEO Tom Clarke. "Unfortunately, our projections didn't account for the slower-than-anticipated implementation of our news distribution deals and the impact of seasonality on advertising sales. These factors hampered our aggressive plans for page view and revenue growth."
The company noted that it has $88 million in cash and expects to be profitable on a cash flow basis by the second half of next year.