Tuesday, Digital River, Inc. (DRIV), a provider of e-commerce solutions, reported a lower profit for the third quarter, despite an increase in revenue, as higher expenses affected bottom-line. The company also provided guidance for the fourth quarter and full year 2009, with earnings expectations for both periods below the current consensus estimates of analysts.
The Eden Prairie, Minnesota-based company's third-quarter net income decreased to $11.0 million or $0.29 per share from $15.6 million or $0.39 per share a year ago.
On a non-GAAP basis, net income declined to $15.9 million or $0.42 per share from $19.2 million or $0.46 per share in the prior-year quarter. Non-GAAP net income excludes amortization of acquisition-related intangibles, stock-based compensation expense, and income tax expense at 27%.
On average, 17 analysts polled by Thomson Reuters estimated earnings of $0.41 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the third quarter of 2009 increased to $99.4 million from $96.3 million for the third quarter of 2008. Analysts expected revenues of $98.34 million for the quarter.
Income from operations decreased to $14.56 million from $17.52 million in the year-earlier quarter, as total costs and expenses rose to $84.86 million from $78.79 million last year.
For the nine-month period, the company's net income decreased to $39.40 million or $1.05 per share from $47.14 million or $1.15 per share in the similar period of 2008. Revenue for the period increased slightly to $298.91 million from $298.31 million in the year-earlier period.
Looking ahead to the fourth quarter, Digital River expects non-GAAP net income per share in the range of $0.30 to $0.34, assuming a 27% tax rate. Revenue is expected in the range of $94 to $98 million. Analysts expect earnings of $0.42 per share on revenues of $96.52 million for the quarter.
For the full year, the company expects non-GAAP net income per share in the range of $1.69 to $1.73, assuming a 27% tax rate. The company estimates revenue to range between $393 million and $397 million. Analysts are looking for earnings of $1.81 per share on revenues of $394.53 million for the full year.
DRIV closed Tuesday's regular trading at $22.32, up $0.10 or 0.45%, on a volume of 1.41 million shares on the Nasdaq.
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