GSI Commerce beats revenue but misses EPS estimates (GSIC 2Q05 earnings)

GSI Commerce (ticker: GSIC) beat the consensus estimate for revenue, but missed the EPS number and guided to lower than expected revenue and EPS for next quarter. Key stats for the quarter and guidance:

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

• Net revenue up 42% to $91.7 million, beating consensus of $87 million.
• EPS of ($0.07) was worse than consensus of ($0.06).
• Merchandise sales up 53% to $136.8 million.
• Revenue breakdown: Product sales from sporting goods category up 25% to $41.9; merchandise sales from sporting goods up 36% to $51.4 million; product sales from other categories up 70% to $33.3 million; merchandise sales from other categories up 65% to $85.4 million; service fee revenues up 43% to $16.5 million.
• Gross profit up 38% to $34.6 million.
• Gross margin was 37.8%, down 100 basis points, "primarily due to product sales from other categories, which carry lower gross margins on a relative basis, growing more rapidly than product sales from sporting goods".
• Total operating expenses up 32% to $37.6 million.
• Total operating expenses, as a percentage of net revenues, decreased to 41.0% from 44.0%.
• Net loss was $2.8 million versus $3.1 million. Includes stock based comp of $1.7 million versus $153,000.
• Adjusted EBITDA was $2.5 million compared to an adjusted EBITDA loss of $535,000.
• Balance Sheet: Cash and equivalents were $117.5 million compared to $75.4 million at the end of last quarter.

Q3 Guidance

• Net revenues of $79.0-84.0 million, versus consensus of $87.3 million.
• Merchandise sales are expected to be in the range of $122.0 million to $132.0 million.
• Net loss of $2.5 million to $3.0 million.
• Adjusted EBITDA is expected to be in the range of $1.5 million to $2.0 million.

Full Year Guidance

• Net revenues of $430.0-445.0 million versus consensus of $424 million.
• Merchandise sales are expected to be in the range of $675.0 million to $695.0 million.
• Net income is expected to be in the range of $9.5 million to $10.5 million.
• Adjusted EBITDA is expected to be in the range of $28.0 million to $29.0 million.

Full press release here.

GSIC chart below.

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