IAC Earnings: Profits Suffer, Investors Sell

In spite of rising revenues, IAC/InterActiveCorp’s (NASDAQ:IACI) profit declined in the third quarter. IAC operates internet businesses in the United States and a number of jurisdictions abroad.

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IAC/InterActiveCorp Earnings Cheat Sheet

Results: Net income for IAC/InterActiveCorp fell to $40.7 million (43 cents per share) vs. $65 million (69 cents per share) a year earlier. This is a decline of 37.4% from the year-earlier quarter.

Revenue: Rose 38.2% to $714.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: IAC/InterActiveCorp reported adjusted net income of 71 cents per share. By that measure, the company beat the mean estimate of 51 cents per share. It beat the average revenue estimate of $664.1 million.

Key Stats:

For the past five quarters, the company has seen double-digit year-over-year percentage revenue growth. Over that span, the company has averaged growth of 36%, with the biggest boost coming in the second quarter when revenue rose 40.2% from the year earlier quarter.

Last quarter’s profit decrease ends a two-quarter streak of year-over-year profit increases. Net income rose 2.1% in the second quarter and 90.8% in the first quarter.

The company has beaten estiamtes for two quarters in a row. In the second quarter, it topped expectations with net income of 66 cents versus a mean estimate of net income of 55 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 64 cents a share to 63 cents over the last sixty days. Over the past three months, the average estimate for the fiscal year has climbed from $2.25 per to share to $2.27.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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