Barry Diller realizes that his Ask search engine isn’t going to gain market share anytime soon, but search can still power growth for IAC if it just keeps up with the growth in the overall search market. IAC released third quarter earnings this morning. Total revenues were up 25 percent to $422 million. Operating income quadrupled to $36 million, and adjusted earnings per share came in at $0.32 versus Wall Street estimates of $0.27. (However, after stripping out the adjustments due to one-time sales of stock and other assets a year ago, net income was actually down 19 percent).
Search represented nearly half of revenues ($205 million). The search business grew 20 percent, goosed primarily by a 55 percent increase in active toolbars to 97 million. IAC’s toolbar business is its secret distribution weapon, but those searches tend to generate lower revenue per query than those on Ask.com, which itself is still growing and is now ranked as the sixth largest website in the U.S. LAst month, Ask CityGrid Media’s new local advertising network also contributed to overall search revenues.
But search wasn’t the fastest growing part of IAC’s business. Revenues for its media and other properties (such as CollegeHumor, The Daily Beast, Electus, Evite, and Vimeo) grew 44 percent to $63 million. Match’s revenues jumped 31 percent to $106 million, with paying subscribers up 30 percent to 1.8 million (“organic” growth in subscribers, though, was 16 percent). The rest of IAC’s revenues came from ServiceMagic, up 10 percent to $48 million.
In terms of operating profits, the two biggest contributors were Match ($38 million) and search ($29 million). The media businesses showed an operating loss of $4.6 million. The company also bought back $125 million worth of shares during the quarter. The stock is up about 5 percent this morning to $27.85 on the earnings news.
IAC is a media conglomerate with a wide range of online assets. In November 2007, announced they would be separating IAC into 5 public companies. IAC will consist of: Ask.com, Bloglines, CitySearch, Evite, Excite, InsiderPages, iWon, My Fun Cards, My Way, Popular Screensaver, Smiley Central, Match.com, chemistry.com, ServiceMagic, Shoebuy.com, BustedTees, CollegeHumor, Garage Games, Gifts.com, Green.com, Instant Action, Very Short List, Vimeo, 23/6. IAC is also an investor in Active.com, Brightcove, FiLife, Medem, Merchant Circle, OpenTable, Points.com and SHOP channel....
Ask.com is a top 10 US website and digital brand (as ranked by Nielsen) with more than 100 million monthly users globally. Founded in 1996, Ask.com was originally known as Ask Jeeves and specialized in natural language search. In Sept 2001, the company acquired Teoma Technologies, and began shifting Ask’s algorithms away from natural language search. AskJeeves was acquired by IAC in March 2005 for $1.85 Billion and renamed Ask.com in 2006. In July 2010, Ask.com returned to its Q&A...
CityGrid Media is an online media company that connects web and mobile publishers with local advertising organizations by linking them through CityGrid, its local content and advertising network. CityGrid Media owns and operates leading local consumer properties including Citysearch, Insider Pages and Urbanspoon. CityGrid Media is an operating business of IAC (NASDAQ: IACI). For more information, visit IAC’s Investors Website.
Match.com pioneered online dating when it launched on the Web in 1995 and continues to lead this exciting and evolving category after more than a decade. Throughout its 15-year history, Match.com has helped millions of singles meet and fall in love. Match.com provides a rich tapestry of ethnicities, interests, goals, ambitions, quirks, looks and personalities from which to choose. Match.com operates some of the leading subscription-based online dating sites in 25 countries, in 8 languages and spanning five continents,...
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