Wall Street worries over InfoSpace results

Mobile content and technology vendor InfoSpace Inc. announced a net loss for the full-year 2006, news that appeared to upset investors as the company’s stock declined around 3 percent to $22.34 per share after the news.
However, the company’s outlook for its next quarter was slightly better than analysts had expected. InfoSpace predicts revenues of between $82 million and $84 million for the first quarter, while analysts polled by Thomson Financial Network expect around $79 million.
“As we emerge from restructuring, our remaining business continues to generate solid cash flow and our strong balance sheet positions us for growth,” said Jim Voelker, InfoSpace CEO.
InfoSpace’s fourth quarter revenues clocked in at $89.3 million, up 3 percent over the same quarter a year ago. The company’s net income was $30 million, down from the $37.9 million the company posted in the year-ago quarter.
For the full-year 2006, InfoSpace lost $12.7 million, a major reversal from the net income of $159.4 million the company scored in 2005.
In InfoSpace’s mobile business, the company’s revenues in the fourth quarter jumped 12 percent over the same quarter a year ago to $47.5 million. The company’s gross profit in mobile popped 39 percent to $18.7 million over the same period.
“In mobile, we believe (InfoSpace’s) core business will not likely deliver meaningful growth and that it’s difficult to gauge the new mobile search/ad product opportunity,” wrote Derrick Wood, an analyst with Pacific Growth Equities. The firm makes a market in InfoSpace securities. InfoSpace’s “reluctance to buy back shares and to communicate a new strategic focus causes us to remain cautious.”
InfoSpace has suffered a number of setbacks recently, including the loss of its ringtones business with Cingular Wireless L.L.C.