The online and offline retailer for teenagers and young adults posted a profit of $779,000, or 4 cents a share, on sales of $42.5 million.
First Call consensus expected Alloy Online to earn only 2 cents a share on sales of $35 million.
Alloy Online shares closed off 19 cents to $10 ahead of the earnings report before moving up to $10.25 in after-hours trading.
The $42.5 million in sales represents a 151 percent improvement from the year-ago quarter when it lost $4 million, or 27 cents a share, on sales of $16.9 million.
"We're extremely happy with our fourth-quarter results," CEO Matt Diamond said during a conference call with analysts. "The teen market is hot. While the overall marketing environment is not as good as it was last year, teen marketing is growing."
Analysts predict Alloy Online will post a loss of 21 cents a share in its first quarter on sales of $21 million.
Diamond also said the company was comfortable with current estimates--sales of $140.7 million and earnings of 2 cents a share--for fiscal 2000.
Ahead of the earnings report, McDonald Investments analyst Sasha Kostadinov pegged the company for a profit of 2 cents a share, on sales of $34.5 million.
"Investors really need to look farther out for this name," he said. "It has some really attractive traits and no real competition. I call them the MTV of the teen retailing world."
WR Hambrecht analyst Derek Brown, who rates the stock a "strong buy," was expecting sales of $34.8 million and earnings of 2 cents a share.
"Their business model is truly next generation," he said. "On the whole, the demographic they are targeting is massive and Net savvy. This company should serve as a beacon of light for investors."
Merchandises sales accounted for $36.6 million of total sales in the quarter, up 145 percent from the $14.9 million it recorded in the year-ago quarter. Sponsorship and advertising sales came in at $5.9 million, up 194 percent from $2 million in the same period last year.
Gross profit margins for the quarter and year were 57.8 percent and 58.6 percent, respectively.
The company exited the quarter with $25 million in cash and short-term investments, up from $24 million in the third quarter.
For the fiscal year, Alloy Online posted a loss of $16.5 million, or 87 cents a share, on sales of $91.2 million. This is up 169 percent from fiscal 1999 when it lost $13.9 million, or $1.09 a share, on sales of $33.9 million.
Last quarter, it lost $6.3 million, or 30 cents a share, on sales of $28.1 million.
Compared with other Internet stocks, Alloy Online's performance in 2001 has been spectacular considering it closed at $7 a share on Jan. 2.
All seven analysts following the stock rate it either a "buy" or "strong buy."