Is Aptimus the Latest Spyware Casualty? (APTM, INSP)

Internet ad network company Aptimus (ticker: APTM) pre-announced lower than expected Q3 revenue and profits. A careful read of the press release shows that Aptimus is the latest company to suffer from what it euphamistically calls "low quality leads", or perhaps in plain English "page views generated from Adware and Spyware". Here's the key quote from the press release:

Aptimus expects Q3 2005 revenues of approximately $3.8MM. The revenue shortfall during the quarter occurred primarily due to the Company's termination of publisher relationships that were incompatible with its strategic objective of delivering the best quality leads to its advertiser clients. While those relationships had contributed to the company's performance in earlier quarters, they became less viable and attractive with the growing market appetite for only the highest quality leads. Consequently, the company elected during the quarter to accelerate its shift in focus away from publisher environments that were high volume, but weren't able to deliver the highest quality leads, which in turn negatively impacted short-term revenues. Many of these relationships were also based on fixed CPM type payment arrangements, and the margins in those arrangements declined as the company removed key, high value offers from those placements to improve lead quality for those offers.

Aptimus' pre-announcement follows Infospace's (ticker: INSP) poor results last quarter, which it also attributed to "traffic quality" issues.