RealTime IT News

theglobe.com Reels, But It's Still Spinning

Blaming a slowdown in online ad spending, community and game site company theglobe.com said its third-quarter pro forma loss per share will be between 37 and 35 cents, significantly higher than the 28 cents per share loss expected by analysts.

The company's stock, which at one time traded in the $17 range, was diving again this morning to a new 52-week low of 78 cents in early trading. The founders of theglobe.com stepped down last January after seeing its stock fall into the single digits and experiencing wider-than-expected losses. The company has never made any money, according to its filings with the SEC.

theglobe.com said it expects to report revenues of between $6.1 and $6.4 million, compared to analyst estimates of $11.0 million in revenues. For the six months ended June 30, revenues totaled $15.4 million, up from $7.3 million. Net loss totaled $49.2 million, up from $19.4 million.

But the company is not giving up, and no layoffs have been announced so far.

In fact new CEO Chuck Peck, named to the top job just last month, said: "We have begun to implement the first of several restructuring initiatives aimed at better positioning theglobe.com to capitalize on the expected long-term growth in advertising spending, while also enhancing our distribution of games information content from games.theglobe.com to other leading Web properties, and licensing our community tools to targeted industries."

Specifically, the company has named a new vice president of sales, Mark Martiak, most recently with Engage Media, a CMGI company, where he held the position of vice president media Sales, Northeast. Prior to that he was advertising director at Forbes.com.

Also as part of the restructuring, theglobe.com said it is redeploying and/or adding additional senior ad sales representatives at corporate headquarters in New York, as well as in other key cities throughout the country. It also is establishing a sales office in London to serve the European market.

"Since joining theglobe.com in August, I have conducted a thorough review of the company's business units, advertising sales functions, games products distribution initiatives, and cost structure and I believe more than ever that there is significant value within theglobe.com's model that has yet to be realized," Peck said.

theglobe.com is a network of communities that specializes in bringing people together around shared topics of interest. The company also owns a games information community, games.theglobe.com, comprised of Happy Puppy, Kids Domain, Games Domain, Console Domain, Chips & Bits (an e-commerce site), Computer Games Online and Computer Games Magazine.