Tech Industry

Lycos beats 3Q forecasts

Lycos (Nasdaq: LCOS) topped estimates in the third quarter.

After market close Wednesday, the Web portal operator reported fiscal third quarter net income of $7.9 million, or 7 cents per share, not counting special charges. First Call consensus predicted a profit of 5 cents per share for the quarter ended April 30.

With goodwill amortization, Lycos reported a pre-tax operating loss of $32.3 million. If all line items are factored in, including taxes and $270.2 million in investment gains, Lycos earned $122.4 million, or $1.05 per share.

Third quarter revenue increased to $78.6 million, up 15 percent sequentially and up 120 percent year-over-year. Pro forma perating margin, which excludes goodwill writedowns and one-time charges, was 7.97 percent.

"The continued improvement of our operating margins reflect the leverage provided by our successful operating model," said Edward M. Philip, CFO and chief operating officer. "We will continue to take advantage of the economies of scale afforded us by our industry leading network model."

Lycos in April averaged 148 million daily page views, a 21 percent sequential gain. Registered users rose 15 percent in the quarter to 55 million, with new users signing up at a rate of 90,000 per day.

Shares of Lycos rose to 58 1/4 in afterhours activity on the Island electronic communications network, immediately following the earnings report.

The stock closed Wednesday's regular trading at 57 39/64, down 15 1/64 for the session after the company confirmed rumors it would be acquired by Terra Networks (Nasdaq: TRRA), which is majority-owned by Telefonica SA (NYSE: TEF).

• Conference call Webcasts still shaky
• It's official: Lycos sold for $12.5 billion
• Lycos flies past 2Q estimates>