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CMGI beats Street
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December 15, 1999: 6:49 p.m. ET
Net investment firm’s 1Q loss narrower than Wall Street estimates, splits stock
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NEW YORK (CNNfn) - CMGI reported a fiscal first-quarter loss Wednesday that was much narrower than Wall Street had forecast in an acquisition-heavy quarter for the Internet investment firm.
The company also announced a 2-for-1 stock split available to shareholders of record as of Dec. 28.
For the quarter ended Oct. 31, the Andover, Mass.-based firm recorded a loss of $1.08 a share. Analysts polled by First Call Corp. expected CMGI (CMGI) to lose $1.76 a share. Revenue rose 231 percent to $123.7 million.
Those results exclude several one-time items. Including those charges, CMGI lost $6.8 million, or 10 cents a share in the quarter.
CMGI announced its results after the markets closed.
In the year-ago period, CMGI posted a profit of $38.4 million, or 38 cents a share, on $37.4 million in revenue.
Shares of CMGI dropped 6 to close at 199-3/4 on the Nasdaq stock market. Its shares jumped 30-1/16 to 229-13/16 in after-hours trade, which indicates CMGI’s stock should open higher when regular trading resumes Thursday.
CMGI's business model centers on building Web properties to take them public. So far it has created or acquired 58 subsidiaries, including investments made through its @Ventures affiliate. Earlier Wednesday, the company agreed to acquire yesmail.com Inc., which specializes in marketing by e-mail, for about $500 million in stock.
CMGI counts AltaVista, which is reportedly gearing up for an initial public offering worth $5 billion, among its properties.
"CMGI began the new fiscal year with its most active quarter to date, highlighted by closing four and announcing five additional acquisitions, completing our second operating company IPO, and securing several strategic partnerships, including our first in the emerging Asian Internet marketplace,” said David Wetherell, CMGI chairman and chief executive officer.
"The new additions to the CMGI family will serve as strong reinforcements to our leadership goals in the online marketing and advertising and instant messaging arenas, and will support our strategy for significant international expansion in the year 2000.”
CMGI has been targeting the Internet advertising market, as evidenced by its $500 million acquisition of AdForce Inc. (ADFC) and its $193 million purchase of AdKnowledge Inc., both in September. The moves are a direct challenge to DoubleClick (DCLK), the leading Internet advertising firm.
Wetherell said the company’s latest crop of acquisitions "establish CMGI as a microcosm” of what’s happening in the Internet economy.
Although CMGI plans to double the number of firms in its stable to 120 from 58, Wetherell said, "We will be choosing our acquisitions and investments more carefully.” 
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CMGI
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