Xpedior Inc. (Nasdaq: XPDR) joined the pack of plunging Internet services companies Tuesday after it announced third quarter revenue will decline about 10 percent from $62.9 million last quarter.
Like Scient (Nasdaq: SCNT), Viant (Nasdaq: VIAN) and iXL (Nasdaq: IIXL) before it, the company blamed a “pull back of spending by "dot-com' businesses.” The pull back has also led to some delays in decision making among the company’s Global 2000 clients, it said.
Xpedior shares fell 1.81 to 9, or 18 percent Tuesday, as the company also got downgraded to “hold” from “buy” at First Union Securities.
Xpedior said it will continue to focus on generating EBITDA (earnings before interest, taxes, depreciation, and amortization) positive results as soon as possible, and remains optimistic it will return in the fourth quarter to consistent sequential quarterly revenue growth. Though revenue will be down sequentially it is still expected to be 65 percent greater than the $34.5 million in revenue recorded in last year’s third quarter.
iXL, down 1.63 to 6.75 ,was also downgraded to “hold” from “buy” at First Union Securities Tuesday; Scient was up 0.19 to 22.19 after announcing a stock repurchase plan Sept. 1, and Viant (Nasdaq: VIAN) was off 0.44 to 7.75 following its warning Friday.
Internet Services companies that have not warned, but have seen their stocks sink with sector downgrades include Agency.com (Nasdaq: ACOM), Proxicom Inc. (Nasdaq: PXCM) and Razorfish (Nasdaq: RAZF).
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