The Internet incubator saw its stock lose $1.34 at $5.50 in early trading on the Nasdaq. By the close, the stock was down $1.16 to $5.69.
CMGI, which holds large stakes in a variety of companies, including Engage, AltaVista and Critical Path, had traded at a 52-week high of $151.50 before sinking to a low of $3.63 on mounting losses and dwindling cash reserves.
This latest bout of bad news comes less than a month-and-a-half after CMGI's previous guidance. The company said it now likely will miss its annual revenue target of $1.65 billion for the fiscal year that ends July 31. For the second quarter ending Jan. 31, the company said it expects revenue to range from $335 million to $345 million.
Consolidated gross profit margin projections of 30 percent by the fourth quarter will consequently fall short, the company said.
CMGI said it could no longer project cash burn, or net outflow, levels for the remainder of the year. The company also backed away from any target date for achieving profitability on the basis of EBITDA (earnings before interest, taxes, depreciation and amortization).
Previously, the company said it expected to reduce its quarterly cash burn rate to $45 million by the end of this fiscal year. It had also predicted that four of its five operating units would reach EBITDA profitability by the end of the fiscal year.
The new guidance comes despite an aggressive cost-cutting campaign by CMGI. Hurt by a downturn in online advertising, the company has been slashing jobs, unloading stock and closing shop at a number of the companies in the CMGI stable.
At AltaVista, CMGI's majority-owned search engine, 200 jobs, or 25 percent of the work force, are being slashed to reduce reliance on online advertising. The story is similar at Engage, where half of its 1,100 employees will be let go.
And then there is Critical Path, which was halved to $9.81 Friday, after the company missed estimates for its quarter and lowered its guidance. Critical Path also was downgraded by a slew of analysts.
Despite the news, CMGI Chief Financial Officer Andrew J. Hajducky said the company has enough cash to fund operations until the company reaches profitability. He said the company will exit the year with $600 million to $700 million in cash and cash equivalents.
The company currently has $1 billion in cash and securities in its coffers.
CMGI also said it plans to consolidate its 13 majority-owned companies into as few as five companies by the end of the fiscal year.
CMGI said it would issue further guidance along with the reporting of actual second-quarter results on March 13.