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Verity earnings disappoint

The search engine company, which has seen its earnings rise and fall over the past several quarters, witnesses a downturn.

Verity (VRTY) today reported third-quarter results that again fell short of analysts expectations.

Verity, a search engine company, reported a net loss of $10.8 million, or $1 a share for the quarter ending February 28, compared with net earnings of $112,000, or 1 cent a share, for the year-ago period.

Excluding a one-time acquisition charge of $10 million for Cognisoft, the company would have posted a loss of $800,000, or 7 cents a share.

Wall Street had expected the company to report a loss of 4 cents a share, according to First Call. Analysts had earlier projected the company would report a loss of 1 cent, before Verity announced several weeks ago that its loss would be steeper than previously expected. Verity's third quarter was on track with those revised estimates.

Revenues, meanwhile, rose 39 percent to $11.1 million for the quarter, up from the same time a year ago. But compared against the previous quarter revenues fell 4 percent.

Verity's software revenues increased 43 percent to $9.2 million for the quarter over a year ago, but fell 6 percent relative to the previous quarter.

The company has reported mixed earnings during the last couple of quarters. Verity reported a $1.3 million loss in the first quarter, but followed with profits of $222,000 for the second quarter.

Verity's stock, meanwhile, has lost more than half its value since January, when it was trading in the 19 range. The stock hit a free-fall and landed at 6-7/8 at the close of today, down 1 from yesterday. The company reported its results after the market's close.

Verity is looking to combine its search software with Cognisoft's server to step into "push" technology. The company's goal is to make it easier to sift through Internet broadcasts.