"Netscape just ran a clinic in how not to report earnings," the Briefing.com Web site read today. "In what has to be the worst attempt at concealing a lousy quarter in recent memory, the company just lumped a quarter's worth of losses into a black hole called January and used the sale of securities to eke out a break-even figure for the February-April quarter."
Briefing.com is one of a growing number of subscription-based sites that provide financial commentary and analysis on the Net. Others include TheStreet.com. Briefing.com's senior staff includes former analysts and managers of Standard & Poor's MMS International. These sites are attracting a following as more investors turn to the Net.
As Briefing.com sees it, "The first four quarters of 1998 were lousy for Netscape, and what's worse is that they tried to make the market believe they were great. Let's hope the company doesn't believe its own spin."
"Confusing, isn't it?" wrote TheStreet.com. "It's understandable when an investor [or reporter] can't make sense of Netscape's financial doings. But an analyst?" The site went on to quote analysts who also were perplexed.
"This quarter would not have been even or black ink if they were not able to dump [about] $55 million off in January," said Jim Balderston, an industry analyst with Zona Research.
Some analysts were bullish. Morgan Stanley raised its 1998 fiscal year estimates on Netscape from a loss of 61 cents per share to a loss of 58 cents per share. It kept its estimates for fiscal year 1999 unchanged.
Netscape stock was up nearly 7 percent in midmorning trading.
As reported, Netscape said it broke even for its second fiscal quarter but posted a $54.2 million loss for the month of January.
The company reported revenues of $127.2 million for the three months ending April 30, compared with revenue of $120.5 million for the March quarter last year.
Netscape chief administrative officer Peter Currie said the company was pleased with the results, saying they pointed to steady growth in enterprise software, services, and its Netcenter Web site.