InfoSpace surpasses 3Q expectations

InfoSpace.com (Nasdaq: INSP) continued its profitable run ahead of analyst estimates.

In third quarter results released after market close Thursday, the provider of Internet content services reported net income of $3.1 million, or 6 cents per share, excluding costs and writedowns related to acquisitions. First Call's survey of eight analysts predicted a loss of 2 cents per share.

Including acquisition charges, Infosapce earned $1.3 million, or 2 cents per share.

Third quarter revenue increased to $10.1 million, a 50 percent gain sequentially and fourfold improvement year-over-year. InfoSpace ended the third quarter with a backlog of $38 million.

"We had a totally awesome quarter," said Naveen Jain, chairman and CEO. "Our ability to produce a profit this quarter while sustaining rapid revenue growth proves that we are executing on our aggressive growth strategy while controlling costs."

Services such as real-time stock quotes, traffic reports, price shopping, local guides and other Internet content for wireless devices were the fastest growing part of the business, the company said.

On the traditional Web content side, InfoSpace added 300 portals to its network during the quarter, bringing the total to 2,100. The network now reaches more than 86 percent of the Internet audience, the company said. InfoSpace's affiliate network garnered 1.62 billin page views during the quarter, the company said, citing Media Metrix statistics.

Also Thursday, InfoSpace announced a plan to buy Zephyr Software, a provider of portal services for India.

Shares of InfoSpace increased 2 1/4 to 50 in Thursday's regular trading prior to the earnings report. Among eight analysts surveyed by Zack's Investment Research, five recommend InfoSpace as a "strong buy" and three have the equivalent of "moderate buy" ratings on the stock.>