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RealTime IT News

One Year Later - Inktomi, NetGravity And Beyond.com

A year ago this month three Internet companies with vastly different business models went public. Today shares of all three are trading well above their respective first-day closing price, with one company in particular emerging as a favorite among investors and analysts.

In order of IPO date, here's a look at how each member of the Class of June 1998 has fared:

Inktomi Corp. was best-known for its search engine technology at the time of its June 10 initial public offering last year, but even back then the San Mateo, Calif.-based company was betting a large part of its future on its solution to the bandwidth constraints faced by ISPs and large corporate networks.

The company's cluster-technology based Traffic Server has attracted customers such as America Online and Digex, while helping Inktomi increase revenues to $14.6 million in the quarter ended March 31, a 323 percent increase over the year-ago quarterly sales of $3.5 million. Meanwhile, the quarterly net loss fell from $4.8 million a year ago to $4.6 million.

That latest earnings statement, released two months ago, enabled Inktomi to beat analysts' estimates for the third consecutive quarter.

Investors also have noticed Inktomi's strong positioning in the caching and search engine markets, as well as its expansion into Shopping Engine software for portals and its recently announced directory-generation technology.

After an impressive debut, Inktomi (INKT) shares closed at $36 on the first day of trading, a 100% gain over the $18 offer price - the stock climbed above $50 in November and surged above $100 in April. While it has come down from a high of $159.13 on April 12, Inktomi still has plenty of altitude, trading early Thursday afternoon at $115.

Online advertising and direct marketing software seller NetGravity Inc., also based in San Mateo, barely closed above its $9 offer price on June 12, 1998, finishing the day at $9.75. As of Thursday afternoon, (NETG) shares were selling at $19.25 -- almost twice that price.

In between then and now, however, NetGravity missed much of the wild run-up experienced by many other Internet stocks. A steep price rise begun in mid-March pulled NETG shares as high as $66.88 on April 12. By May 25, though it fell below $20 a share once more.

The quick descent was triggered by a first-quarter earnings report in mid-April that showed only a 10% growth in revenues over Q4 '98, though more than twice the revenues reported in Q1 '98. Net loss also increased in Q1 to $3.75 million from $2.8 million a year earlier.

When online retailer Beyond.com Corp. went public last June 17, it was known as software.net and traded under the symbol SWNT. The company's initial offering was for 5 million shares at $9 each, and the first-day close of $13.25 showed a 47% gain.

Beyond.com, based in Sunnyvale, Calif., was trading early Thursday afternoon at $21.88. Save for a couple of brief spikes and a recent mild dip, shares have been selling between $20 and $30 a share since early December.

The company's first name accurately described what it did then and what it still does - sell off-the-shelf software via the Internet to consumers, businesses and government agencies.

(BYND) shares got a 35% bump on June 4 when it won a software contract with the Internal Revenue Service.

A few weeks earlier the stock rose on news of lower-than-expected losses and higher-than-expected revenues inthe first quarter.


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