Tech Industry

Digital Island beats 4Q forecasts, sees increased losses in 2001

Digital Island (Nasdaq: ISLD) lost less than analysts anticpated in the fourth quarter, but predicted higher-than-expected losses in fiscal 2001.

After market close Wednesday, the provider of e-commerce network services reported a fiscal fourth quarter loss of $113 million, or $1.60 per share. First Call's survey of 16 analysts predicted a loss of $1.69 per share for the quarter ended Sept. 30.

Shares of Digital Island rose to 11.5 in afterhours activity on the Island electronics communications network, following the release of quarterly results. Digital Island stock fell 1.3125 to 11.3125 in Wednesday's regular trading, prior to the fourth quarter report.

Excluding amortization costs, Digital Island lost $54.1 million, or 76 cents per share.

Also Wednesday, Digital Island said it sees per-share losses ranging between $1.80 and $1.85 in the first quarter and $7.60 and $7.70 for fiscal 2001. First Call consensus was predicting losses of $1.79 per share and $7.19 per share for the first quarter and full 2001, respectively.

First quarter revenue will be about $31 million, and full year revenue will be $190 million to $195 million, Digital Island said.

The company reiterated its expectation of breakeven results before interest, taxes, depreciation and amortization by the end of calendar 2002.

Fourth quarter revenue increased 50 percent sequentially and 388 percent year-over-year to $24.1 million. The company's number of contracted customers rose to 949, up 148 percent from the third quarter.

For the full fiscal 2000, Digital Island lost $329.9 million, or $5.59 per share, on revenue of $59.1 million.

Digital Island ended the fourth quarter with $590.6 million in cash and marketable securities. The company said it has enough to fund its operations for the next six quarters.>