DoubleClick Inc, one of only about three internet ad network companies that really matter right now, nosed ahead of Street expectations with its third quarter results announced last night after the close, but saw its shares fall in after-hours trading. The company dominates the ad-serving market and its only viable competitor in that market is […]
DoubleClick Inc, one of only about three internet ad network companies that really matter right now, nosed ahead of Street expectations with its third quarter results announced last night after the close, but saw its shares fall in after-hours trading.
The company dominates the ad-serving market and its only viable competitor in that market is a clutch of companies owned by CMGI Inc, including Flycast Communications Corp, AdForce Inc and AdKnowledge Inc. It appears that a battle is on between DoubleClick and CMGI to win the heart of 24/7 Media Inc, one of the last ad-related prizes still left.
The company beat analyst’s expectations for its net losses by one cent, coming at losses of 13 cents per share, or $5.4m. Revenues were up 114% on a year ago at $45.0m, while its system revenues, which also excludes the revenues the company collects on behalf of its largest customer, AltaVista Corp (which ironically enough is majority-owned by CMGI) was at $60.4m, compared to $20.8m last year. The $45.0m third quarter revenue number is 45% ahead of the previous quarter.
The media side of the business grew 37% over the previous quarter in terms of revenues to system revenues of $48m. International revenues were one of the strongest features of the quarter, now accounting for 20% of system revenues and the company opened three new offices in Asia during the quarter.
The company’s Dart technology, which enables companies to control their online marketing campaigns, was responsible for delivering 17 billion ads during September, and average of 567 million impression a day, a 56% rise on the numbers in June. Kevin Ryan, the company’s president says it is seeing higher CPMs across the board and doesn’t see any reason why that upward trend should halt in the fourth quarter. The company now has two separate versions of the technology: one for publishers and one for advertisers. Overall, media CPMs were up, while technology CPMs were stable according to Ryan. The company is one of those competing for the contract to serve ads on the Lycos Inc network, which is apparently up for grabs right now.
During the quarter the company announced its proposed acquisition of NetGravity, perhaps its biggest rival, and that deal is expected to close in November, as is the June deal to buy Abacus Direct, a direct email marketing company. Charges for those acquisitions will affect the fourth quarter. The company will move into larger New York-based headquarters next month. á
