Perfect World Earnings: Here’s Why Investors are Not Happy Now

Perfect World Co., Ltd. (NASDAQ:PWRD) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 10.92%.

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Perfect World Co., Ltd. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 91.38% to $0.47 in the quarter versus EPS of $5.45 in the year-earlier quarter.

Revenue: Was the same at $109.13 million as the year-earlier quarter.

Actual vs. Wall St. Expectations: Perfect World Co., Ltd. reported adjusted EPS income of $0.47 per share. By that measure, the company missed the mean analyst estimate of $2.53. It missed the average revenue estimate of $679.36 million.

Quoting Management: Mr. Michael Chi, Chairman of Perfect World commented, “We ended 2012 with the fourth quarter top-line results in line with our expectations. During the past year of 2012, we decelerated in-game promotional activities and primarily focused on longer-term projects in our pipeline and content enhancements for our existing titles in order to maintain a healthy life cycle of our portfolio and sustainable growth of our business. As such, our 2012 results came in softer than our previous year’s results. However, we believe this was a necessary step for the long-term benefit of our business and are confident that our efforts over the past year will translate into more high-quality entertainment and services for our players worldwide in 2013 and beyond.”

Key Stats (on next page)…

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