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Liberate quarterly loss smaller than expected

Interactive TV company Liberate Technologies posts a fourth-quarter loss that is narrower than expected, amid a 78 percent increase in revenue from a year ago.

Interactive TV company Liberate Technologies today posted a fourth-quarter loss that was narrower than expected, amid a 78 percent increase in revenue from the same quarter a year ago.

Excluding acquisitions and other charges, Liberate lost $11.4 million, or 13 cents per share, in the quarter ended May 31, on revenue of $9.1 million. Analysts had been expecting Liberate to post a loss of 20 cents per share, according to First Call/Thomson Financial.

In the same quarter a year ago, Liberate lost $9.5 million, or 16 cents per share, on revenue of $5.1 million.

The number of shares used to calculate per-share earnings count shares converted from preferred stock and bonds at the time of Liberate's September initial public offering, as if the shares had been converted to common stock from the time they were initially issued.

Counting the charges, Liberate lost $37 million, or 41 cents per share.

"We're confident the business is going well," said senior vice president Dave Limp. "We're just bullish in general."

Limp did not give specific financial predictions but said the company is comfortable with current Wall Street estimates.

Limp said there have been two main questions about interactive television.

"One is, 'Will viewers dig it?' and the second is, 'Will big network operators get it out there so viewers get the chance to dig it?'" Limp said. "Our results this quarter and (other industry statistics) are starting to tell us that the answer to both those questions is 'yes.'"

In particular, Limp pointed to the success of shows such as "Who Wants to be a Millionaire?" and "Survivor" as examples of programs that would be naturals for interactive television. It's easy to imagine viewers playing along with "Millionaire" or voting who gets kicked of the island on "Survivor," Limp said.

Liberate's shares have followed a near bell curve in recent months. The stock rose from a first-day close of about $10 (split adjusted) last September to more than $140 around New Year's, but have plummeted to the low-$20s in recent weeks.

"The market in general has been a bell curve," Limp said.

Limp said the company is not changing any of its own practices as a result of the stock drop but said Liberate has been careful not to burn through its cash too quickly.

"We have over $425 million in cash and short-term investments," he said. "We will be well into profitability before we have to raise more money."

Liberate is the Oracle unit formerly known as Network Computer.