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HolidayBuyer's Guide
Tech Industry

Media Metrix delivers 3Q upside surprise

Media Metrix (Nasdaq: MMXI), best known as the Internet's ratings service, handily beat estimates Thursday with a third quarter loss of $1.3 million, or 8 cents a share, excluding amortization as revenue jumped 29 percent from the second quarter. First Call consensus called for a loss of 17 cents a share.

Including amortization costs, Media Metrix reported a loss of $2.6 million, or 15 cents a share, on par with the second quarter results. In the year ago quarter, the company lost 10 cents a share excluding amortization and 16 cents including it.

Revenue for the quarter came in at $5.5 million, up from $4.3 million in the second quarter. Compared to a year ago, sales were up 268 percent from $1.5 million.

In a statement, Media Metrix said new clients fueled the quarter. It also sold more products and services to existing clients. Media Metrix also topped estimates in the second quarter.

International expansion, however, cut into gross margins. Margins were down in the third quarter to 46 percent from 50 percent in the second quarter.

Media Metrix, which went public in May (see filings), said it invested approximately $1.1 million in recruiting panels and other start up costs in connection with its joint venture in Germany, France and the United Kingdom. The company is also expanding in Australia and New Zealand, and will record start-up costs in the fourth quarter. The company didn't record any revenue from the new ventures in the quarter.

Media Metrix cited numerous moves in the quarter including a new version of its metering software and the acquisition of AdRelevance for $59.4 million. The company said it will spread out merger costs over three years and take an in-process research and development charge of $6.8 million in the fourth quarter.

The company has been a solid performer (chart) for investors with a 52-week high of 74 and a low of 31 7/8. Shares closed at 58 Thursday.