GoTo Going the Distance, Despite Industry-Wide Turmoil
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Executives from pay-for-placement search engine GoTo said Thursday that the company would best previously-given guidance for revenue and net loss during its first quarter. The Pasadena-based company last told the market that it expected to see revenue of $45 million and a pro forma loss of $16 million.
For the fourth quarter GoTo posted a quarterly loss of $16.8 million or $0.34 per share, on $39.8 million in revenue -- income that was nearly 60 percent higher than the previous quarter.
The company didn't say by how much it now anticipates exceeding its earlier guidance, or whether the news will have any effect on its estimates for reaching profitability, which the company last said it anticipates occurring in fourth quarter.
It's not much for investors and analysts to go on, but the news is still reassuring for an otherwise unhealthy sector -- in which many of GoTo's competitors for the online marketing dollar are struggling to find cash (like 24/7 Media) or laying off and restructuring (like industry leader DoubleClick).
Wall Street previously expected GoTo to post a loss of $0.33 per share for the quarter, according to First Call/Thompson Financial estimates.
On Thursday, the company also announced that last month it surpassed 40,000 active advertisers for its paid search engine listings service, which is distributed through affiliates including America Online, Terra Lycos and AltaVista. Those numbers are up from 37,000 advertisers at the end of December, and 21,000 advertisers at the end of December, 1999.
"Internet search is the ultimate direct marketing medium," said GoTo president and chief executive officer Ted Meisel. "As advertisers look for measurable results, particularly in a challenging economy, they continue to adopt GoTo in increasing numbers. Our ability to drive the top and bottom lines is directly correlated to the value we provide our 40,000 advertisers."