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InfoSpace (ticker: INSP) beat consensus EPS estimates by $0.06, but missed consensus revenue estimates, and drastically lowered guidance for next quarter and the full year. Key stats from the quarter and guidance:


Q2 Results
(all comparisons are year over year unless stated otherwise)

  • Revenue rose 52.8% to $83.2 million, below consensus of $85.4 million.
  • Content and distribution expenses rose 87.3% to $34.9 million.
  • Systems and network operations expenses rose 28.5% to $4.9 million.
  • Product development expenses rose 36.1% to $7.6 million.
  • Sales and marketing expenses rose 38.3% to $7.0 million.
  • G&A expenses rose 8.1% to $9.7 million.
  • Operating expenses rose 65.5% to $69.8 million.
  • Operating income rose 8.9% to $13.4 million.
  • Operating margin was 16.1% vs 22.5% in Q2 2004.
  • Net income rose 20.6% to $16.3 million.
  • Diluted EPS was $0.44 vs $0.37 in Q2 2004, and above consensus of $0.38.

Q3 Guidance

  • Revenue of $75.0 - $80.0 million, significantly below consensus of $94 million.
  • Adjusted EBITDA of $9.0 - $11.0 million.
  • Net income of $5.5 - $7.5 million.
  • Fully diluted EPS of $0.15 - $0.20 versus consensus of $0.45.

FY 2005 Revised Guidance

  • Revenue of $330.0 - $340.0 million. Previous guidance of $375.0 - $395.0 million. Consensus was $377 million.
  • Adjusted EBITDA of $62.0 - $67.0 million. Previous guidance of $92.0 – 100.0 million.
  • Net income of $44.0 - $47.0 million. Previous guidance of $67.0 - $75.0 million.
  • Fully diluted EPS of $1.15 - $1.25 (assuming an effective income tax rate of 38% in Q4). Previous guidance of $1.75 - $1.95. Consensus was $1.85.

INSP chart.
Insp726

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Source: InfoSpace lowers guidance, stock whacked (INSP 2Q05 earnings results)