Cost-per-click ad network ValueClick Friday said it would miss its third-quarter estimates, in another instance of repercussions from the much-publicized dot-com ad spending slowdown.
The company said it expects revenue for the third quarter of 2000 to come in between $9.5 million and $10 million, down from predictions of $12.5 million to $13 million at the end of Q2. Analysts previously expected the company to break even for the quarter.
Executives said the company remained optimistic about year’s final quarter, though it now expects to report a profit in the first quarter of 2001, rather than Q4 2000.
At the same time, ValueClick set a $10 million share buyback program.
Based on Thursday’s closing price of $8.56, the repurchase amounts to about 1.17 million shares, or about 4 percent of the company’s outstanding shares.
“We experienced a dip in Internet advertising expenditures, which has been consistent with market performance of our competitors over the past two quarters,” said ValueClick chairman and chief executive officer James Zarley.
For the most part, that’s true. This month, i-agency Avenue A and ad technology company MediaPlex
also issued warnings that they would not hit revenue estimate. Avenue A replaced its CFO shortly following the announcement.
CMGI-owned ad network and technology firm Engage
posted better-than-expected earnings due largely to sales of its enterprise software.
But even Engage’s officers admitted that the company has been stymied by the spending slowdown, and were forced to cut 175 positions in a move to hasten profitability.
ValueClick said its 3Q revenue slowdowns were buoyed by global expansion and a number of technological advances, including the implementation of DoubleClick‘s DART ad serving, optimization and reporting technology.