Shares of ValueClick, Inc. (VCLK) dropped 6 percent in extended trading of Thursday after the Online advertising service provider provided a weak guidance for the third quarter. Meanwhile, the company reported a profit for the second quarter that grew from last year, reflecting 29 percent revenue growth. Both adjusted earnings and quarterly revenues also topped analysts' expectations.
The company noted that it has consolidated the Mediaplex technology business into the Media segment during the quarter, resulting in three segments: Media, Affiliate Marketing, and Owned & Operated.
The move is based on the increased revenue synergies between Mediaplex's advertiser base and Media's display offerings. The company said it has started to see some early success from the strategic move of providing an integrated offering to its advertisers.
"We delivered another quarter of strong financial results, while further leveraging our unique data, traffic and services capabilities to become a more strategic partner for our clients," CEO James Zarley said in a statement.
The Westlake Village, California-based company reported net income of $20.33 million or $0.25 per share for the second quarter, higher than $16.98 million or $0.21 per share in the prior-year quarter.
Excluding one-time items, adjusted income for the quarter increased to $29.88 million or $0.37 per share from $22.39 million or $0.28 per share in the year-ago quarter.
On average, 13 analysts polled by Thomson Reuters expected the company to earn $0.22 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the quarter grew 29 percent to $160.98 million from $125.06 million in the same quarter last year, and topped twelve Wall Street analysts' consensus estimate of $157.97 million.
By segment, affiliate marketing revenues grew 3 percent to $33.61 million, and media revenue surged 75 percent to $91.09 million, while revenue from owned & operated websites declined 10 percent to $36.40 million from the year-ago quarter.
Looking ahead to third quarter, ValueClick expects adjusted earnings in a range of $0.36 to $0.37 per share, on projected revenues between $164 million and $169 million. Analysts currently expect earnings of $0.26 per share for the quarter, on revenues of $173.41 million.
For the fourth quarter, the company currently anticipates adjusted earnings of $0.52 to $0.53 per share, on projected revenues between $200 million and $210 million.
"As illustrated in our share repurchase activity, we remain confident in our ability to become the partner of choice for the largest, most sophisticated digital advertisers and capitalize on the growth opportunities in our industry," Zarley added.
VCLK closed Thursday's regular trading session at $15.53, up $0.19 or 1.24% on a volume of 1.24 million shares. However, the stock lost $0.93 or 5.99% in after-hours trading.
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