RealTime IT News

Akamai, FreeMarkets, GoTo.com Slip After Beating Estimates

Akamai, FreeMarkets and GoTo.com were the latest Internet companies to beat earnings estimates yet see their shares slip. Priceline.com fell to a new low in the regular trading session.

The ISDEX fell 37 to 764, negating its recent breakout at 790, and the Nasdaq fell 113 to 3981, back below 4000. The S&P lost 15 to 1464, and the Dow declined 48 to 10,684, buoyed by strength in Merck. Volume declined to 872 million shares on the NYSE and 1.46 billion on the Nasdaq. Declining issues led 17 to 11 on the NYSE and by a 2-to-1 margin for the second day in a row on the Nasdaq. The major economic reports for the week are the second-quarter Employment Cost Index on Thursday and the GDP on Friday. eBay reports earnings after the close tomorrow.

Akamai Technologies reported a second-quarter loss of 50 cents a share after the bell, 7 cents better than estimates. But the stock slipped to 105 in after-hours trading, after falling 9 1/8 to 107 7/8 in the regular trading session.

GoTo.com reported a second-quarter loss of 23 cents, 8 cents better than estimates. But after rising 2 15/16 to 20 1/8 in regular trading on news of a deal with CompuServe, the stock retreated to 19 1/2 after hours.

FreeMarkets added 1 1/4 to 53 1/2 in regular trading, but fell to 51 after hours after the company reported a second-quarter loss of 34 cents a share, 7 cents better than estimates. MP3.com beat estimates by a nickel with a second quarter loss of 8 cents a share. The stock, which ended the day down 1/16 to 12 1/16, traded just under 12 after hours.

Shares of Red Hat slipped $1 after hours on news that CEO Harold Covert has resigned. The stock ended regular trading down 1 9/16 to 23 3/4.

Priceline.com led Internet shares lower during regular trading, falling 9 to 31 1/16, a new low. The company reported a first-quarter loss of 1 cent a share, 2 cents better than expected, and revenues rose more than 200% to $352 million. The company lost 10 cents in the year-ago quarter. Merrill Lynch said the company appears to be headed for profitability, but investors were unimpressed by the company's sequential growth of 12%.

CMGI fell 3 3/16 to 38 9/16 after Wit SoundView maintained its fourth-quarter revenue estimate of $373 million, but raised operating expense estimates from $651 million to $911 million and lowered its fourth-quarter loss estimates from $1.57 to $2.45. Wit maintained its Strong Buy rating on the company.

Internet infrastructure plays were strong on news of a potential $100 billion deal between Nortel and Corning . Corning fell more than 10%, down 32 3/4 to 251, on news that Nortel may sell the company its optical parts unit in exchange for a greater than 50% stake in Corning. New Focus , up 17 1/8 to 158 7/16 and EXFO , up 5 1/4 to 84 1/2, were among the stocks rising on the news.

Tut Systems continued its move from a breakout on Friday on better-than-expected earnings, adding 10 3/16 to 95 11/16, but down from an intraday high of 99 1/2.

Two recent IPOs received positive comments from numerous brokerages as their post-IPO quite periods expired. Genuity declined 5/16 to 9 13/16, but Stratos Lightwave gained 4 to 53.

ZDNet preannounced second quarter earnings that were a penny better than expected. The stock added 5/16 to 17 5/8, and CNET , which is buying the company and parent Ziff-Davis , added 5/16 to 31 1/8.

VerticalNet gained 1 5/16 to 56 11/16 on news of completed ventures with Softbank and British Telecom. Goldman Sachs made positive comments ahead of